For The Consumer

No-Load Life Insurance: Why haven't you heard about it?

Over the years, most of the financial publications have published articles on the advantages that no-load life insurance offers to the consumer. Unfortunately, most insurance is sold by commission agents/planners because the industry has built its product distribution channels on commission incentives. Those few fee advisors who bring awareness of the product to their clients and prospective clients experience an acceptance factor well over 90%.

If your advisor has not shown you this policy, it is because (a) they prefer to sell you commission policies that pay high first year commissions without full disclosure as to how much they are being remunerated; (b) They provide financial planning and asset management for a fee, but neglect their fiduciary responsibility and obligation when it comes time to sell you life insurance; (c) they have heard about it but have not taken the time to find out how to properly use it; (d) they have not heard about it, or (e) they handle equity/investments only and do not engage in full financial planning concepts. If your advisor falls into category (e), you should contact a fee-insurance advisor for your insurance needs. If your advisor falls into category (d), you should refer them to our site. If your advisor falls into categories (a), (b) or (c), you may want to rethink the relationship.

The first thing to understand is that this product was designed for the fee-only or fee-based advisor. Therefore, you will be paying a fee instead of commission for design and implementation of the policy. Fees will vary, depending on the work involved, complexity of the case, and other factors. However, the fee is fully disclosed and is usually much less than the commission on a comparable policy.

This policy has no surrender charges, wide flexibility of premium design, full disclosure of premium breakdown and costs, first year cash values that could exceed premium, and total control by the client.

Comparing premiums and cash values, we can take a look at a sample case, using a 40 year old male, non-smoker, and a $500,000 universal life policy. Illustrated is a no-load product and a commission product from the same company to keep the comparisons fair.

You can see that the no-load policy gives you much more flexibility in premium latitude, much higher cash value in same-premium comparison, and much higher cash value in maximum 7-Pay premium design.

In fact, in the 7-Pay maximum premium example, the 1st year cash value of the no-load product exceeds the 7-Pay premium payment.

In addition to the basic cost efficiencies, consider the use and application when doing Estate Planning, or Business Planning. Such strategies as family split dollar can be very exciting with no-load insurance.

For those who may own a business, creative strategies with no-load insurance in the area of Key-Person insurance, Buy & Sell Arrangements, and Deferred Compensation will astound you.

Space is limited to expound on all of the advantages of no-load insurance. Visit the Links to Referred Advisors, or call our toll free number at 1-888-854-0931 for more information.

If you haven't yet done so, you should visit the following links on the homepage for background information on no-load life: Advantages of No-Load Insurance and FAQ's

IMPORTANT

 1) We are a resource to the financial planning and advisory community. If you are interested in looking at the advantages of no-load insurance, any information we may send to you will be general in nature and only for the purpose of understanding the concepts and advantages. Actual case development must be done by a planner/advisor on a fee-for-service basis. It is highly recommended that you use someone who has the knowledge and experience in working with these products so that you can attain the maximum advantages.

 2) If you or your planner/advisor tries to compare an illustration of a commission policy to the no-load policy illustration.... BEWARE.  Go and review the 5th question in the FAQ's link on the Home page.

 Thank you for your interest in no-load / low-load life insurance.