With life insurance policies the term standard risk pertains to when an insured doesn’t have any ailment, special condition or otherwise that the company providing coverage would deem riskier than the average (hence the word standard). This of course is determined in the carrier’s underwriting rules or standards to whom would qualify as standard risk. The average person without any major health problems but isn’t in athletic condition either would fit into this category.
An individual that is in very good health, considered above the average in their condition health wise and considered low risk as per the insurance company is known a preferred risk. The factors used to calculated this vary but some things can help an individual get life insurance as preferred risk. A couple examples would be not to smoke and too have the right blood pressure readings. There are other factors though that a person cannot not do anything about that may matter to the company, for instance a history of cancer in the family.
Now to the sub-standard risk which is an individual that would be looked at as high risk to give a life insurance policy to. This would pertain to a person that has a a poor medical history but it can go beyond just that. A dangerous occupation can play a role as well as other things such as harsh living environment, family history of disease and more.