A Life insurance table rating can be expensive, but they don’t have to be!
People who receive a rating may get a better offer by moving to a new life insurer.
What are Life Insurance Table Ratings?
Table ratings represent an insured’s excess risk to a life insurer due to health issues, professions, and avocations.
Ratings are numbered (1-16) or lettered (A-P), and each rating adds 25% to a standard rate.
The numbers and letters are interchangeable.
The exception to the 25% rating system is Prudential as we explain later.
Minor health problems such as high blood pressure or high cholesterol do not require table ratings.
However, heart conditions and other chronic health disorders may require a table rating.
Life Insurance Table Rating Chart
Below is an example of how underwriting table ratings work.
While most life insurers use 25% ratings, Prudential has its own table rating system that uses different rating percentages than other companies.
Click Here for Prudential’s Table Rating Chart
|Table 1 = Table “A”||Add 33% to Standard Rate|
|Table 2 = Table “B”||Add 56% to Standard Rate|
|Table 3 = Table “C”||Add 80% to Standard Rate|
|Table 4 = Table “D”||Add 113% to Standard Rate|
|Table 5 = Table “E”||Add 161% to Standard Rate|
|Table 6 = Table “F”||Add 208% to Standard Rate|
|Table 7 = Table “G”||Add 256% to |
|Table 8 = Table “H”||Add 327% to Standard Rate|
On the surface, it might seem that Prudential is at a disadvantage due to higher percentage ratings.
Suppose you are looking at a survivorship policy for estate purposes.
In that case, it is possible to have one uninsurable client on the policy.
Uninsurable ratings range from U1-U7, depending on the medical condition.
Are Table Ratings Negotiable?
Table ratings are negotiable, but not often.
The primary consideration by underwriting is the risk associated with the applicant’s profile.
A higher risk profile pays more for life insurance than someone with no health issues.
Suppose an applicant with an increased risk profile applies for life insurance.
In that case, we may be able to improve the offer by one table rating (25%) if favorable factors exist.
The reality is that life insurance underwriters follow internal and reinsurance guidelines, which leave little room for better offers.
It’s often easier to move you to a new company for a better rate than to try and renegotiate your offer with the existing company.
Table Shave Programs
Table shave programs help improve underwriting offers.
When available, a table shave program may offer you a universal life policy for a similar price to term life insurance.
AIG – American General – Flex Points Crediting Program – Suspended
Provides a one-table reduction if you meet 4 of their 16 factors.
An example of a factor would be no family history of heart disease.
Lincoln National Table Reduction Program – Suspended
People rated up to Table 3 receive standard rates.
Principal Healthy LifeStyle Credit and Automatic Standard Approval Programs – Active as of 01/2021
Removes up to two table ratings.
Specific cases that receive flat extra ratings may also qualify here.
Automatic Standard Approval Program (ASAP) – Insureds rated up to Table 3 may receive a standard offer.
Prudential Rate Reduction Program – Active as of 01/2021
Allows insureds rated up to Table B to receive standard rates.
While technically, this is not a table shave program, the bottom line is more favorable offers.
Available for term life and permanent life insurance products.
United of Omaha Fit Underwriting Credit Program
Insureds rated up to Table 4 may receive standard life insurance rates.
Term life and universal life insurance policies are available.
United does well when the insured’s build is rated.
Should You Accept a Rated Offer?
If you received a table-rated offer, what should you do?
Your options include:
- Decline the Offer
- Accept the Offer
- Temporarily accept the offer
- Reduce the Coverage/ Change the Terms
In most cases, you should probably accept the offer, at least temporarily.
We’ll then re-shop the market for you to see if better offers are available.
You may even be able to use your paramedical exam from the first company.
You can switch to the new company if we find a better offer.
If not, at least you will have coverage if you are denied life insurance with all other companies.
Our expertise is life insurance underwriting.
Our approach works by taking the time upfront to understand your medical history.
We use a Quick Quote process to receive preliminary underwriting feedback in days.
The benefit is that you receive accurate quotes from companies specializing in your medical history.
Keep in mind that there is never any obligation or pressure with our service.
Thank you for your time.
We look forward to working with you.