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Standard and Non Standard Policy FormsThe only difference is the Policy Forms they are written on and the range of applicants that can be accepted

Standard Insurance policies are written on state approved policy forms. Standard Policy forms are regulated by the state in which they are issued and are cookie cutter policies that differ very little from one company to another in coverages, language and price with narrow acceptance rules. They are geared to the preferred client with good credit and underwritten in such a way as to limit risk exposures for the Insurance Company and exclude certain classes of drivers. They are quite popular for use by insurers and that's why so many companies use them, hence the term "Standard".

Nonstandard Insurance Policies are also written on state approved Policy forms and vary widely in pricing because they are custom policies designed by the issuing company to be able to accept a broader market range of risks. Many do not even take your personal credit into account for rating at all. They may be cheaper than standard or they may be higher depending on the risks presented and are most often unique to that company, Hence the term nonstandard.

It has nothing to do with the financial health nor the Am Best rating of the Insurance Company nor the quality of coverage. No State has any requirement of law that you seek out a nonstandard policy due to a DUI.

There is no such thing as a substandard policy in the U.S. because no state would even allow a policy deemed as such to be sold in their jurisdiction.

Nonstandard by no stretch of the imagination should be construed as Sub Standard in any way what so ever. They essentially offer the same coverages but for a broader class of people. In fact, many Insurance Companies offer both standard and non standard policies. All Standard and Nonstandard Policy forms must be approved by the state in which they are issued and the issuing company must follow all your state laws and regulations.

Answer from a General Insurance Agent


Another Wiki AnswerNon-standard insurance is to cover any special needs. If someone is arrested for DUI he will be required to carry non-standard isurance that agrees to cover people with DUI prior's. Some non-standard life insurance is necessary if an individual is a sky-diver or has a high risk job or hobby. In general, non-standard insurance is more expensive because the insured individual is considered to be a higher risk.

This could also be referring to the risk rating that the underwriter will set, based on the health of the proposed insured. Standard rated means somebody of average age, average health, , average risk career, average risk location etc. Sub-standard is therefore somebody who is older, smokes, more unhealthy (depending on the results of the medical tests). Preferred and Preferred Plus are exceptionally good risks for the insurer, though the underwriter will usually choose these rates. So, standard or sub-standard will have higher premiums, with possible loading applied to offset the risk and preferred and preferred plus will enjoy lower premiums due to the low risk of mortality early in the policy.

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2011-01-11 12:30:56
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Q: What is the difference between standard and nonstandard insurance?
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