Rated life insurance in Canada: what a table rating means

A rating is an approval, not a rejection. The insurer will cover you at a higher premium. Ratings come as table ratings, each step typically adding roughly 25 percent to the standard premium, or as flat extras charged per $1,000 of coverage. Flat extras are often temporary, and permanent ratings can sometimes be reconsidered later.

The letter says “approved, rated table 3” and it reads like bad news. It is not, particularly. It means the insurer assessed a higher than average risk and priced for it rather than walking away. Understanding the structure tells you whether to accept, negotiate, or look elsewhere.

Table ratings

The most common form of substandard offer. Insurers label tables either numerically, usually 1 to 16, or alphabetically, A to P, and the two systems are equivalent. Table 1 equals Table A, Table 2 equals Table B, and so on. In practice, offers above roughly Table 4 to 8 are uncommon; past that point, most insurers decline instead.

Each table typically adds about 25 percent of the standard premium.

So on a standard premium of $200 per month, a Table 2 offer is roughly $300 and a Table 4 offer roughly $400. Exact schedules vary by insurer, and some use non standard structures. The percentage is also applied to the base premium rate rather than to the policy fee, so the all-in cost usually lands slightly below these multiples. Treat the table as the common pattern rather than a universal rule.

Flat extras

A different mechanism entirely. Instead of a percentage uplift, the insurer adds a fixed dollar amount per $1,000 of coverage per year.

On $500,000 of coverage, a flat extra of $2.50 per $1,000 adds $1,250 annually.

Two features matter:

Flat extras are commonly used for temporary or non medical risks. Recent surgery, a recent diagnosis in a recovery phase, a hazardous occupation, a dangerous avocation like scuba diving or private aviation.

They are frequently time limited. Many flat extras are applied for a defined period, commonly three to five years and sometimes up to ten, and then fall away automatically. Always ask whether yours is permanent or temporary, and get the answer in writing. This is one of the most consequential questions on the offer and it is rarely volunteered.

Some offers combine both: a table rating for a medical condition plus a flat extra for an occupation or avocation.

Why the same file rates differently at different insurers

This is the part that matters most, and the reason a brokerage is worth more on a rated file than on a healthy one.

Every insurer publishes its own underwriting guidelines, built on its own claims experience, reinsurance arrangements and risk appetite. Those guidelines differ materially. The same medical file can draw Table 2 at one company and Table 4 at another, or standard at one and a decline at a third.

Build charts are a clear example. Insurers publish different height and weight tables, so an applicant sitting just outside one company’s chart can land comfortably inside another’s.

Two further wrinkles:

A higher table at a cheaper insurer can cost less than a lower table at an expensive one. The table is a multiplier applied to that company’s base rate, and base rates differ. Comparing tables without comparing premiums is meaningless.

Some insurers specialise. Certain companies have deliberately developed appetite for particular conditions or occupations and price them more keenly than the market.

Which is why the sensible order is to find out where your file fits with an anonymous pre check before applying anywhere, rather than applying and discovering afterwards.

Getting a rating reduced or removed

Ratings are not always permanent, and a reconsideration request is a normal part of the process rather than a complaint.

Time limited flat extras expire on their own. Check the schedule. Some people pay them for years after they should have dropped off because nobody diarised the date.

Table ratings can be reconsidered with new evidence. If the underlying condition has stabilised or improved in a documented way, you can request a review. What supports it:

• Recent lab results showing improvement in the relevant markers
• A letter from a treating specialist confirming stability
• Documented sustained weight change
• Evidence of medication adherence over time
• Completion of a treatment protocol without recurrence

Timing. Most insurers want to see a reasonable period of stability, commonly one to two years, before reconsidering. Ask the specific insurer what it wants and when.

Reconsideration is not automatic. Nobody reviews your file unless you ask.

Should you accept a rated offer?

Usually yes, at least provisionally, and here is the reasoning.

Accept and keep it in force while you shop. A rated policy in force is coverage. Declining it to go looking leaves you uninsured in the interval, and if your health changes you may not get another offer at all.

Then compare properly. Ask your advisor to price the same coverage at other insurers with different appetite for your condition.

Then reconsider later. If the offer stands and the condition stabilises, request a review in a year or two.

The only strong case for refusing outright is where the rating is severe enough that a simplified issue product with few health questions, or a guaranteed issue product with none, can cost less for the coverage you need. That comparison is worth running at higher tables, with both quotes in hand rather than by assumption.

Frequently asked questions

Is a rated policy still real insurance?

Yes, entirely. It pays the same death benefit, on the same terms, with the same tax treatment. Only the premium differs.

Can a rating be added after I am approved?

Not once the policy is in force; premiums are contractual at issue. Before it is in force, an insurer can revise an offer if new medical information emerges. This is one reason not to cancel existing coverage before a replacement is delivered.

Does a rating show up on future applications?

Insurers submit coded information to MIB, which retains records for up to seven years and releases them to member insurers with your consent. Applications also commonly ask directly about prior ratings.

How long before I can ask for a review?

Most insurers want one to two years of documented stability. Ask yours what it requires specifically.

Do ratings affect the death benefit?

No. A rated policy pays the full face amount. The rating affects premium only.

Is a rating better or worse than a decline?

Considerably better. It is an approval. It means an insurer assessed your file and chose to offer coverage. If you did receive a decline instead, our guide for declined applicants covers the route back.

What to do next

Received a rated offer? Keep it in force and let us shop it. A licensed advisor prices the same coverage at insurers with different appetite for your condition, and tells you whether the offer in your hand is the best one available.