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Understanding Life Insurance Table Ratings





In life insurance lingo, a "table rating" refers to the life insurance premiums charged to people who cannot qualify for standard rates. Life insurance companies identify their tables in various ways, such as Table 1, 2, 3 and above or Table A, B, C, etc.

"Table ratings can be given for medical and non-medical conditions," says Thomas Bigoski, owner of the Bigoski Insurance Agency in Gainesville, Va. "Some examples include high blood pressure, cancer, diabetes and your combined height and weight, especially obesity. Other issues could be a history of mental illness or your occupation." (See: "How much can you save on life insurance by losing weight?")

A life insurance applicant with a history of multiple convictions for driving under the influence or someone who pilots small planes could also receive a table rating, says Maureen Leydon, vice president and chief underwriter for MetLife in Boston.

Anything that increases the likelihood of premature death can trigger a table rating.

Table ratings and insurance premiums

Bigoski says table ratings add to the applicant's premiums incrementally, typically by 10, 25 or 50 percent above the standard premium. (See: "That'll cost ya: 7 deadly insurance sins.")

"For example, if a standard premium for a term life policy is $100, if someone has a table rate of 1, they might pay 25 percent above the standard rate, or $125 per month," says Bigoski. "If they have a table rate of 2 they might pay 50 percent above the standard rate, or $150 per month."

Leydon says that the size of the premium increase varies by insurance company and by life insurance product.

Life insurance companies typically assign debits and credits based on your medical history and other factors when calculating your premiums. For instance, if you have heart disease or cancer, that would be a debit -the more debits you have, the more costly your premiums. If, however, you receive a credit for healthy blood pressure and cholesterol, these credits would decrease your premium.

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