Most people are often determined to implement the Infinite Banking Concept IBC in their lives, but they aren’t sure how to get it done.

The main challenge is usually determining the right insurance company like Ascendant Financial to execute this concept, or maybe they haven’t come across the right insurance broker to get them started.

In case you’re looking for an insurance company where you can turn the Infinite Banking Concept into a reality, then your first search should target the insurance companies offering dividend-paying whole life insurance.

Reason? Infinite Banking Concept which is also referred to as Bank on Yourself, Becoming Your Own Banker or BYOB in Canada, among several other terms, uses this particular type of policy offered by well-established mutual whole life insurance companies to design a personal bank, where the policy owner can use his/her cash value as collateral to finance transactions and purchases that would otherwise be financed by a conventional bank or creditor.

When you eliminate the banks from the equation and finance all your expenses via the Infinite Banking Concept courtesy of your whole life insurance policy, you become the beneficiary of the interest that you would have paid to the banks. Consequently, you accelerate your cash value as well as recapture your own interest.

Up to this point, I hope nothing sounds strange or foreign to you since I believe you are familiar with the Infinite Banking Concept.

However, if this sound new to you or you’d like a moment to freshen up your mind on the concept, here are some whole life insurance policies basics that you need to know and it’s what will guide you on what to look for to ensure you get a company that will propel you towards your infinite banking needs.

Meaning of Whole Life Cash Value

Whole life insurance refers to permanent insurance that has strong guarantees. It has a guaranteed cash value accumulation, guaranteed death benefit, and guaranteed premiums.

Cash value accumulates within whole life insurance policies. We can compare the cash value portion to a savings account where you can access your funds whenever you want. We compare it to a savings account since the cash value will keep growing. It never experiences up and down fluctuations.

Cash value is the engine of every whole life insurance used for infinite banking—it makes it desirable for the majority of infinite bankers.

Cash value is built by two features of most whole life insurance policies:

• The guaranteed rate of return
• Non-guaranteed rate of return (dividends)

Each insurance company guarantees to pay a fixed rate of return known as a guaranteed rate of return. The guaranteed rate of return remains constant for the entire life of a policy. Since it’s constant, it minimizes the downside risk.

The non-guaranteed rate of return, also known as dividends, tops up the guaranteed rate. The dividend is only earned when a company is doing well. The dividends are paid out to participate in policies. Dividends also enable the cash value of a policy to accumulate tax-deferred.

There are also ways of reaping additional cash value from your whole life insurance. One of these is by acquiring more paid-up additions to the policy.

Putting additional cash value on your policy is referred to as over funding. It is upon you to decide whether you need an over-funded whole life insurance policy. Even without over funding your policy, you can still get whole-life products that are structured for faster cash value growth.

Finally on this, is to understand how you can get out your cash value. There are three ways you can access your whole life insurance policy cash value:

• Policy loans
• Distributions
• Withdraw dividends in the form of cash

The majority of policyholders get cash out of their whole life policies through loans. You don’t have to pay back the loans. In case you don’t repay the loan, the amount will be deducted from your permanent death benefit when you pass away.

Getting money out of your policy as loans is the most ideal method since when you borrow a policy loan, you get the cash tax-free.

Now that you have refreshed your mind, let’s look at what you need to check to determine a whole life insurance company to use to actualize your infinite banking dream.

In this article, you will get to know about the criteria you can follow to identify whole life insurance companies that are suitable when it comes to offering cash value life insurance.

Sincerely, the top insurance companies indeed offer extra benefits. Some of these companies take their staff and agents through training on the Nelson Nash method, where they are trained on how to ensure their clients get a deeper understanding of wealth creation methods that are beyond the periphery of Wall St.

Criteria When Choosing an Insurance Company for IBC

There are certain criteria for IBC that you need to know before deciding on a company to use for your personal banking.

Remember that the ultimate success or failure of a particular methodology will fall down to execution. The product may be perfect, but if you don’t implement it, you will not achieve your desired results.

With that in mind, it is worth knowing that some companies are not ideal for IBC, therefore it pays to be aware of which ones are and which ones are not—and how to identify the ideal ones.

In this article, we break down the criteria for picking the best insurance company for the Infinite Banking Concept (IBC).

First Criteria: Stock Company Vs Mutual Company

Kiplinger’s Personal Finance Magazine states that when looking for a cash value life insurance, the best choice is a mutual company.

With mutual insurance companies as opposed to stock companies, the policy owner is a shareholder in the company. The member takes part in sharing the company’s investment gains.

Being a policyholder of an insurance policy from a mutual company like ascendant financial means you’re a participant — you receive dividends on your policy’s cash value. The dividends are a return of premium and not income—they are tax-free.

To be precise, the dividend is a return on the overpaid premium (the profit generated by the company in a year, returned to the policy owner). With stock companies, the largest portion of the profits goes to shareholders and not policyholders.

Additionally, mutual life insurance companies often focus on stability and long-term growth.

On the other hand, stock companies have to convince long-term policyholders as well as achieve the stockholder’s short-term goals, which to some extent creates a conflict of interest.

Following these major benefits, mutual companies are preferable.

Again, excess profits made by mutual life insurance companies are only utilized for things that benefit policyholders.

Second Criteria—Performance History (cash value growth, dividend payments, loan rates)

Your policy’s cash value is an integral part of the Infinite Banking Concept since it forms the pool of cash that finances your entire banking needs in the form of cash flow banking in Canada. A lack of an adequate cash pool means you will have limited banking options.

Participating Life Insurance

It is often emphasized that dividends aren’t guaranteed, a fact that whole life insurance critics trumpet.

Even though it may be factual that the dividends aren’t guaranteed, history informs us that certain participating whole life insurance infinite banking companies enjoy a strong track record of regular dividend payments in all manner of economic situations and cycles such as the Great Recession and Great Depression.

Therefore, when looking for an infinite banking life insurance company, be keen on their track record when it comes to paying dividends. This is important in getting a reliable expectation for accelerated cash value accumulation.

Loan Rates

Another important factor to check in the IBC approach is loan rates.

When designing your IBC whole life insurance policy, you should emphasize the cost of loans and the ongoing rate of dividends since the key objective is to maintain an ideal arbitrage.

You should aim to search for the best whole life insurance companies for accumulating cash value with continuous cash value that is not impacted negatively by life insurance loans since it gives room for leverage as well as various levels of wealth creation. Therefore, the history of a company’s loan interest rates matters a lot.

Third Criteria—Stability (History of the company, reliability)

Top insurance companies for infinite banking are associated with a solid account of stability, since that is crucial in being your own banker and financing your banking expenses.

You can check for adequately established mutual life insurance companies that have strong financial power as well as excellent credit rating.

Fourth Criteria—Flexibility (Paid-up additions options, convertibility, design, products)

Just say, some companies are highly flexible compared to others in terms of paid-up additions (adding cash value to the policy) and premium design, and designing a policy that matches your needs.

In this case, flexibility can refer to both flexibilities in giving room for paid-up additions, availability of a range of products, as well as other mechanisms that accommodate individuals who intend to accelerate their cash value growth.

Flexibility is important for individuals that are looking forward to implementing the Infinite Banking Concept since there are various ways to speed up the growth and financing of your banking goals.

Certain companies have only one banking method through your policy, therefore the representatives may convince you that it’s “great” for infinite banking. However, sincerely speaking, they are luring you to a limited bank—something that may turn out to be a serious stumbling block in the future.

Fifth Criteria—General Suitability (for conduit wealth creation, infinite banking IBC, strategic purposes)

The extent to which a particular infinite banking company is suitable for IBC is based on the above criteria and the education and training of the company and representatives.

It is easier to converse with companies that have acquired the infinite banking concept (IBC) training when you are giving a shot at something new in the banking industry.

Final Word

The above is the criteria you need to apply when determining the insurance company to use for the Infinite Banking Concept for becoming your own banker or BYOB in Canada. However, another critical thing is having the right agent for your IBC journey. The right person for you is the one who is ready to take his/her time to understand your circumstance and then develop a plan that will speed up the growth of your plan to achieve your goal through Your policy’s cash value is an integral part of the Infinite Banking Concept since it forms the pool of cash that finances your entire banking needs in the form of cash flow banking in Canada.