What is no-load life insurance?
No-load life insurance is a type of policy that doesn’t charge fees for starting or updating the policy. You avoid other fees, including agent fees, when you choose a no-load life insurance policy, but this kind of life insurance may not work if you have unique needs and are worried about buying the wrong life insurance. Learn more about no-load life insurance below and shop for free life insurance quotes.
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Jeff Root
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Jeff is a well-known speaker and expert in life insurance and financial planning. He has spoken at top insurance conferences around the U.S., including the InsuranceNewsNet Super Conference, the 8% Nation Insurance Wealth Conference, and the Digital Life Insurance Agent Mastermind. He has been featured and quoted in Nerdwallet, Bloomberg, Forbes, U.S. News & Money, USA Today, and other leading...
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UPDATED: Dec 12, 2023
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Advertiser Disclosure: We strive to help you make confident insurance decisions. Comparison shopping should be easy. We are not affiliated with any one insurance provider and cannot guarantee quotes from any single provider. Our insurance industry partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.
Editorial Guidelines: We are a free online resource for anyone interested in learning more about life insurance. Our goal is to be an objective, third-party resource for everything life insurance related. We update our site regularly, and all content is reviewed by life insurance experts.
UPDATED: Dec 12, 2023
It’s all about you. We want to help you make the right coverage choices.
Advertiser Disclosure: We strive to help you make confident insurance decisions. Comparison shopping should be easy. We are not affiliated with any one insurance provider and cannot guarantee quotes from any single provider. Our insurance industry partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.
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If you’re looking to save a few bucks on your life insurance policy, “no-load life insurance” might help you achieve that goal.
No-load life insurance policies are a great way to reap the benefits of a whole life insurance policy without breaking the bank.
[Also consider a term life policy, which can provide a lot of coverage for a low price.]
What Is no-load life insurance?
Similar to a no-load mutual fund, no-load life insurance is a policy that does not charge fees (or severely limits the fees charged) for initiating and servicing the policy.
It is a type of life insurance where no sales commission is paid, unlike most policies which include both upfront and ongoing payments to the agent or representative who sells the insurance policy.
If it merely reduces the fees charged, it may be referred to as a “low load life insurance policy.”
No-load life policy can be an attractive option for those with a tight budget, however, they have less hands-on service. Therefore, when shopping for no-load life insurance, take in mind to make a thorough research before choosing the type and quantity of insurance.
Either way, the main idea is to keep more of your money so you can build cash value faster.
These policies are sold by insurance companies that don’t rely on third-party sales teams. However, insurance customers should know that depending on the details of the insurance contract, the no-load policy might turn to be a more expensive option. This is because insurance companies and representatives include other hidden fees such as processing fees, handling fees, or transaction fees. These sales fees increase the total premium payment paid by the customer.
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What fees do I avoid with no-load life insurance?
Your monthly payment for a whole life insurance policy includes the insurance premium for the actual coverage plus the fees charged by the insurance company.
The fees added to the policy are used to pay for operating expenses at the insurance company, such as agent commissions and advertising.
In a no-load life insurance policy (or low load), the service fees are removed or reduced.
The insurance company attempts to earn a profit strictly on their underwriting operations and the agent must charge you a fee for their service outside of the transaction with the insurance company.
Tip: Make sure to verify any and all fees you may be charged by your agent when purchasing a no-load life insurance policy, as they can vary widely.
Insurance carriers may not charge a fee, but unscrupulous insurance agents may try to add hefty fees of their own, which can lead to higher overall costs.
That said, you will probably pay much less money overall if you opt for a no-load life insurance policy.
Remember, when opting for a whole life insurance policy, the more cash in your account, the faster it will grow. Not having fees charged to your account is a good way to make that happen.
Is there a catch with no-load life insurance?
Not necessarily. However, a common argument against no-load life insurance policies is they lack the personal touch you may receive from an agent or a company who may provide better service in exchange for the continuous fees you are charged.
Additionally, with less overall consultation throughout the purchasing process, some believe an individual may purchase the wrong type of life insurance or the wrong amount of insurance.
A good way to avoid this pitfall is to do plenty of research online, gather insurance quotes, and maybe even speak with an independent agent prior to deciding whether or not to go for a no-load life insurance policy.
Check out our section on how to purchase life insurance to make sure you get the best value for your money.
Read more: How much life insurance do I need?
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Jeff Root
Licensed Insurance Agent
Jeff is a well-known speaker and expert in life insurance and financial planning. He has spoken at top insurance conferences around the U.S., including the InsuranceNewsNet Super Conference, the 8% Nation Insurance Wealth Conference, and the Digital Life Insurance Agent Mastermind. He has been featured and quoted in Nerdwallet, Bloomberg, Forbes, U.S. News & Money, USA Today, and other leading...
Licensed Insurance Agent
Editorial Guidelines: We are a free online resource for anyone interested in learning more about life insurance. Our goal is to be an objective, third-party resource for everything life insurance related. We update our site regularly, and all content is reviewed by life insurance experts.