Hi CarHammer,
Only C1 and the rectifier diodes need to have high voltage ratings. The other parts operate at the 2V of the red LED.
In Canada, the telephone line is about 50VDC when not in use. A 90VAC ringing signal is applied. Therefore the peak of 90VAC is 127V and when added to the 50V makes a peak voltage of 177V during ringing.