MANAGEMENT

Detailed explanation-1: -Loading is a situation primarily used in life and health insurance plans. It is an additional cost added to the premium for certain “risky individuals”. These are people who, due to their medical history, habits, or a hazardous occupation, might have a higher than usual risk of someone making a claim.

Detailed explanation-2: -Loading is an additional amount that is built into the insurance cost. This amount is added to the premium to provide the cover for a ‘risky’ individual.

Detailed explanation-3: -“Loading” is a term used in the insurance industry referring to the extra charge added to the subscription fee upon renewal due to previous claims made by the subscriber. Some people confuse this term with the yearly increase in subscription based on age or medical costs inflation.

Detailed explanation-4: -What Are The Factors That Affect Loading? The term of insurance, type of plan and the amount are a few factors that affect the premium. However, the age of the policyholder is one of the major factors that determine the premium. This is because the chances of mortality are higher for an older person than a younger one.

Detailed explanation-5: -The premium load is the percentage of insurance premium deducted from the premium payments for universal life insurance policies to cover policy expenses, including the agent’s sales commissions.