Make More of Your Money Work for You with No Load Life Insurance

What is "No Load Term Insurance"?
No Load (NL) Life Insurance is a fairly new concept, but if it is available in your area, you might consider it as a life insurance option. "No Load" life insurance, the same thing as "Low Load" is simply insurance that is not commission based. That doesn't necessarily mean that you don't have an agent—although it could mean that.
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If you purchase NL Insurance through an insurance "advisor," he or she will still be a licensed insurance agent in most states. However, instead of earning his commission through the company, he will be paid directly by you. When the agent writes your policy and/or provides service, you will pay a fee set by the company for such work. The benefit, however, is that the policy fees which help the company pay its agents, conduct marketing campaigns and manage your account are much lower. The agent's commission—usually built into the policy—is eliminated.

One advantage of NL Life Insurance to compare is that your money begins to build cash value immediately if you have a whole life or universal life policy. In a NL Term Life Insurance, you have no cash value, but you do have a lower premium.

When to look for No Load Term Life
If money is tight, but you want to get your life insurance started, look for NL Term Life. First, you will know that you are giving your family the maximum possible protection for the least cost. Later, when finances improve, most companies will give you the right to convert the Term to something more permanent, often any time after the first year. Then you will still have the advantage of the Low Load or No load, meaning your cash will build faster and you will have the right to surrender it without penalties should you ever decide to do so. You will also be able to borrow against the converted policy sooner than you could against a traditional policy.

How is the process different when I apply for NL Life Insurance?
In some cases, the only visible difference may be in the effort it takes to actually find a NL Life Insurance Company. NL policies are not sold in all states. Also, since the medical underwriting still applies, you will still have to answer medical questions, and you may have to submit to an on-site physical. If an advisor is involved, that person's fee will be built into your first few months of payment, or may even be paid separately. In the long run, however, it will save you money years into the future.

In other cases, you may be able to get a NL policy through a direct mail campaign or over the telephone or through an internet quote. Be aware that just coming through the mail does not make a policy NL. Several companies send easy issue or graded benefit applications in the mail, but these are often targeted to people with medical issues or to seniors. The policy may look very inexpensive, but often it is only a first year, teaser price which will go up steeply in the second year and thereafter. These policies may or may not be No Load. If you want a NL Term Insurance, you will need to ask whether a company offers it.
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