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📋 '''Table rating''' is an [[Definition:Underwriting | underwriting]] method used primarily in [[Definition:Life insurance | life]] and [[Definition:Health insurance | health insurance]] to assign a higher [[Definition:Premium | premium]] to applicants whose risk profile exceeds the threshold for standard rates but does not warrant outright declination. Rather than offering a single "standard" or "preferred" rate, the insurer places the applicant into one of several graduated risk tiers — often labeled with letters (A through J or higher) or numerical multiples — each carrying an incremental surcharge above the standard [[Definition:Premium rate | premium]].

⚙️ When a [[Definition:Life insurance | life insurance]] applicant's medical history, occupation, lifestyle, or other factors elevate their [[Definition:Mortality risk | mortality]] or [[Definition:Morbidity risk | morbidity]] risk, the [[Definition:Underwriter | underwriter]] consults internal rating tables that map specific conditions or combinations of risk factors to corresponding table assignments. Each step up the table typically adds a fixed percentage — often 25 percent per table — to the base premium. An applicant rated "Table D," for example, might pay 100 percent more than the standard rate. The process relies on [[Definition:Actuarial analysis | actuarial analysis]] of historical [[Definition:Claims data | claims data]] correlating risk characteristics with actual [[Definition:Loss experience | loss experience]], ensuring that the surcharges are proportionate to the additional risk assumed. Some carriers also allow [[Definition:Flat extra premium | flat extra]] charges for temporary risks — such as a hazardous hobby the applicant plans to cease — instead of or in addition to table ratings.

💡 Table rating serves a critical function by expanding the pool of insurable lives rather than simply dividing applicants into "accepted" and "declined" categories. This nuanced approach allows [[Definition:Insurance carrier | carriers]] to write [[Definition:Substandard risk | substandard risks]] profitably, generating [[Definition:Gross written premium (GWP) | premium volume]] that would otherwise be lost. For [[Definition:Insurance agent | agents]] and [[Definition:Insurance broker | brokers]], understanding how different carriers apply table ratings is essential to shopping impaired-risk cases effectively — one insurer's Table C for a particular condition might be another's Table B, meaningfully affecting the client's cost. The practice also intersects with [[Definition:Insurtech | insurtech]] innovation: automated underwriting platforms increasingly use [[Definition:Predictive model | predictive models]] and real-time data to assign table ratings more quickly and consistently than traditional manual review, improving both speed-to-issue and pricing accuracy.

'''Related concepts:'''
{{Div col|colwidth=20em}}
* [[Definition:Substandard risk]]
* [[Definition:Underwriting classification]]
* [[Definition:Flat extra premium]]
* [[Definition:Risk classification]]
* [[Definition:Preferred risk]]
* [[Definition:Medical underwriting]]
{{Div col end}}

Definition:Table rating - Revision history

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