What type of life insurance policy defers sales and administrative charges until the cash value is taken out?

The back-end loaded life insurance policy is designed to defer sales and administrative charges until the cash value is accessed. This means that policyholders do not face immediate deductions from their initial premiums for sales and administrative expenses. Instead, those fees are incurred when the insured decides to withdraw cash value or terminate the policy. This structure can be beneficial for those who wish to allow their investment to grow without immediate charges impacting their contributions.

In contrast, front-end loaded policies impose charges upfront, reducing the initial amount of investment in cash value. Term insurance typically doesn't involve cash value accumulation at all, as it provides pure risk coverage for a specified period. Universal life insurance has more flexible premium payments and adjusts cash value, but it is not specifically characterized by deferring charges like back-end loaded policies. Thus, identifying the characteristics of these different policies is key to understanding the correct answer.