“Special Risk” life insurance is a term used in the life insurance industry to describe an individual who may have risk factors that are atypical or special and do not coincide with the usual standard risk profile when going through the screening or underwriting process with an insurance company.

What determines a “Special Risk?”

Typically with special risk life insurance applicants, one is talking about factors such as past or current medical history, past or current medications, hospitalizations, age or tobacco use. Medical history such as diabetes, multiple sclerosis, heart disease, liver disease, and post-cancer are some of the common conditions characterized as special risk.

An insurance carrier may choose to insure you with any of these pre-existing conditions, but may charge you an extra premium.

Certain occupations may put you in a special risk class. For instance, being a policeman, a pilot, or a fireman could mean you would be put into a “special risk” class.

There are also activities such as rock climbing or scuba diving that may also warrant “special risk.” In addition, a person’s driving history or foreign travel (especially living for a time) to certain parts of the world could also be considered a “special risk” by insurance companies.

There are many important factors in determining pricing with an insurance company. All insurance companies will want to know your age, medical history, tobacco use and whether you are male or female. Your family health history is also part of the criteria insurance carriers use in determining final rates.

There is Good News!

With recent strides in the discovery of new medications and treatment options, not all medical risks are considered “special risks.” Many conditions that just a few years ago would have warranted an extra premium charge, or that were considered “special risk” can now be insured as a standard risk or possibly even a preferred rating.

An example of this would be blood pressure control and cholesterol control. With medication and good control these conditions are no longer considered a “special risk” and many times can be considered at a standard or even preferred risk.

Not all Insurance Companies underwrite the same!

The area of underwriting certain risks is what sets some insurance carriers apart from their competitors. Some insurance carriers are much more adept in underwriting certain risks.

As an example, you may have one particular insurance company that specializes in offering the lowest rates for individuals who are post-cancer. You may have another company that specializes in underwriting individuals with a heart history and another may do well for people who are tobacco users.

There are also companies that specialize in offering the most affordable rates on private pilots, scuba divers and even sky divers and bungee jumpers.

What is a “Table Rating” and what does it mean with “Special Risk” life insurance?

A table rating refers to a classification that an insurance company uses when evaluating a risk. Typically, the table rated classification is used for someone who does not qualify under the preferred or standard risk class assigned by any particular insured. When a life insurance company reviews an application, they will assign a risk classification based on medical history, occupation, financial history and one’s hobby history.

Nowadays, most insurance companies use the “Preferred Best” underwriting class to recognize an individual who is in excellent health. This means an individual satisfies the criteria that the insurance company has established for this risk class and can be extensive. It includes: good blood pressure control, normal build, good family history along with normal current lab work and urinalysis.

It is important to remember that each insurance company evaluates medical history, family history, etc. differently. This is why it is important to work with an independent agent who will take you to an insurance carrier who will underwrite your current situation the best.

If an individual does not qualify for a “Preferred Best” risk class, they may then qualify for another of the common risk classes that carriers use such as “Preferred” class, “Standard Plus” class or “Standard” class. Remember, each insurance company has their own underwriting criteria to qualify for any particular class.

As you may have guessed, the lower the risk class the higher the premium that is charged.

Once an insured is fully underwritten, and it is determined that they do not qualify for one of the above mentioned risk classes, an insurance company may assign a table rating.

Some of the more common pre-existing medical conditions that can reflect a table rating include: diabetes, heart disease or heart attack, cancer history, sleep apnea, kidney disease, multiple sclerosis, sarcoidosis, and stroke.

When insurance companies assign a table rating, they typically assign a letter of the alphabet such as table rating A, table rating B, table rating C, etc.

With most insurance companies, a table rating typically represents a 25% premium rate up above the published standard risk class. For example, if an insured with Barrett’s Esophagus applies for coverage and is approved at a class Table A, that person would be offered a policy that includes a 25% increase above the published standard risk class.

Another person with a history of panic disorder, anxiety and depression might be offered a policy with a Table B rate classification. This person would pay 50% above the standard rate class.

Table ratings from insurance companies typically go as high as table J. This would represent a 250% (25% x 10 tables) premium increase above standard. Typically, anyone who would be rated above a Table J would be declined by an insurance company, and would not qualify for coverage.

Heart disease can be one of the areas where table ratings can vary greatly. With so many conditions related to the heart and the cardiovascular system, you will sometimes find great differences from one insurance company to the next. This is why each person must be assessed on their own merits.

What may be a standard rating for one person from company A may be a table D from another. This is why it is so important to work with an independent agent who has the ability to go to many different insurance carriers on your behalf. There are literally dozens of conditions relating to the heart that underwriters review on a daily basis. You can understand why it’s important to only work with these specialized companies.

Again, it cannot be stated strongly enough, every life insurance company evaluates each individual differently based on health and lifestyle. One company may rate an individual Table B for diabetes and another may not rate the individual at all.

This can make a substantial difference in the premium dollars that you pay. You must use an agent who knows how to negotiate with the different insurance companies to get the lowest risk classification.

I may be a “Special Risk” class. What should I do?

This is where I can help. I will be your advocate and go to the carriers that will offer the lowest rates for permanent protection or term coverage.

Perhaps you are not sure of what health class you may qualify for due to you past or current medical history. If that is the case, it is best for you to contact me to discuss your particular situation to find out what health classification you may qualify for. However, I cannot stress this enough whether you may be a “special risk” class or a “preferred best” class or somewhere in between: The MORE information you share with me about your PRESENT and PAST HEALTH CONDITION (including Doctor Prescribed Medications and Hospitalizations), FAMILY HISTORY, HOBBIES, OCCUPATION/FINANCIAL HISTORY, and DRIVING HISTORY, the better the chance of me finding the coverage you desire at a price that fits into your budget.

I look forward to working with you!