Have you ever heard the terms "load" and "no load" used in the financial services industry? Loading an insurance product usually always costs the company money and pays the agent a commission. There are what people call "front end loads" and "back end loads" on some policies. Most of the time, these loads come with permanent insurance policies. When a policy is loaded, all of the costs of running a business are added together. The least expensive type of life insurance is probably no-load term life insurance. People often wonder why one company's prices are so much lower than another's. Usually, it has to do with the goods and services they offer. The loading part of the life insurance policy is made up of these goods and services. When you buy a no-load term life insurance policy, you usually buy it directly from the insurance company and with little or no help from a professional.
The person who sells life insurance is still very important to a lot of people. If you buy life insurance directly from a company without an agent, it might be cheaper, but you might not get as much professional advice or service. Term life insurance is easy to understand, so you might be able to buy it on your own without the help of a professional. Before we buy life insurance, each of us has to make these choices and decide what we want.
Term life insurance is cheap to start with, so looking for a no-load product might or might not have a big effect on the premium. When you're looking for term life insurance, ask about loading. You might be surprised by what you find out about insurance companies and how they decide on rates. It will also help you when you start looking for permanent life insurance, which you will have to do eventually.
