What is No Load Term Life Insurance

A no load term life insurance policy (sometimes referred to as low-load) is one that is not commission based. It means that agent or merchant fees are not added to your premiums. The drawback to this type of term life insurance is that you are mostly left to your own devices when it comes to having questions about your policy, or making claims on your policy. You are "on your own" and if you do seek help from the company that provided the policy, they may charge you a fee. You are essentially buying the policy directly from the insurer.

You may still deal with an agent when going with a no load term life insurance policy and you will probably have to pay a one time fee up front, but you will not have to roll in commission fees and other merchant costs into your monthly or yearly premiums. So, when you pay your premiums, they are specifically for the coverage the policy provides, not the expenses that the bank has to cover to pay employees or for advertising or for agents.

It is important to note that not all states offer a no load insurance policy option and you will have to ask specifically for one if you want to benefit from the reduced price in premiums. You should know what you are getting yourself into. If you ask for a no load insurance policy, you may just get handed a 20 page form to fill out and be sent on your way. If you feel confident that you can handle this, you could very well benefit financially from the extra leg work on your part.

Medical underwriting still exists with a no load term life insurance policy. You will probably have to at least answer a questionnaire about your medical history and you may be asked to release your medical records to the insurer or submit to a medical examination or blood work. This will also be included in the extra leg work that you need to do to meet the qualifications of the insurer.

Once you fill out the paperwork, the insurer has a licensed agent look it over and they will send you an offer. Be very careful to read the fine print. At this point, you haven't paid anything to an agent or broker, so there is no obligation to agree to the offer. This is another benefit of a no load term life insurance policy. If you don't like what you see, don't sign it.