Which risk classification is associated with individuals that can still receive insurance but at a higher premium?

The classification linked to individuals who can obtain insurance but at an elevated premium is known as substandard risks. This category encompasses applicants who present higher risks compared to the average population due to various factors such as health conditions, lifestyle choices, or dangerous occupations.

Underwriting guidelines assess these individuals carefully; while they are eligible for coverage, the insurance company applies higher premiums as a way to balance the increased likelihood of claims. This enables the insurer to manage risk while providing opportunities for those who might otherwise face difficulties in obtaining coverage.

In contrast, standard risks are considered average and typically receive regular premiums, while preferred risks are individuals who are deemed lower risk and enjoy discounted premiums. Declined risks are those individuals who are considered too high-risk to insure at any price, resulting in a denial of coverage. Understanding these classifications helps clarify the insurance company's approach to risk management and pricing.