Understanding The Main Life Insurance Classifications

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Life insurance companies use a system of classification to determine an individual’s state of health, based on a series of factors pertaining to that person. Your classification can affect how much life insurance coverage you can get at each price point. Healthy people get more favorable classifications and lower rates. If you have health issues, that will be reflected in your life insurance premiums.

The simple reason behind this is that insurers want to determine which policyholders are more likely to die while the policy is still in force. When that occurs, the insurance company has to pay out.

What Are The Basic Life Insurance Health Classifications?

All life insurance companies use roughly the same classification system to determine how much you have to pay for life insurance. The following are the four main classifications used in determining premiums.

  • Preferred Plus: This is the highest classification, assigned to individuals in excellent health. To qualify for Preferred Plus, your lifestyle must be healthy, your BMI must be ideal, and your family history must be clean.
  • Preferred: This is for people who may have a few minor issues but are still in very good health. Individuals in the Preferred classification pay more for life insurance than those in Preferred Plus, but are still getting some of the best available rates.
  • Standard Plus: People classified as Standard Plus are in good health, but may not be in an ideal height/weight range and may have a few health indicators to keep an eye on. These individuals have good family histories, so no surprises are expected.
  • Standard: In the Standard classification, individuals have an average life expectancy, a less than ideal height/weight ratio, and a few doctors’ notes from their medical exams. Family history plays a role, with instances of family members having health issue before the age of 60. You will still be able to get life insurance in this classification, but your premiums will be high.

What Steps Can You Take To Improve Your Life Insurance Classification?

Having life insurance can bring peace of mind to you and your family. Too often people forego this protection because of perceived costs. Our experienced agent can help you find the lowest available rates for life insurance.

The best way to lower your life insurance premiums is to improve your health classification. The following steps can help you accomplish that:

  • Maintain a healthy weight: Most insurance companies use standard height/weight tables to determine what is healthy. Maintaining a healthy weight consistently over time can help you qualify for a higher classification and lower your premiums.
  • Do not smoke or use nicotine products: If you are a smoker, quit. If you are not a smoker, do not start. The longer it has been since you quit smoking, the lower your life insurance rates are likely to be.
  • Control any existing medical conditions: If you have asthma, high blood pressure, high cholesterol, or other health issues, you can still qualify for a higher life insurance classification. The key is to have regular visits with your doctor, take your medications as directed, and follow your doctor’s advice for controlling the condition.