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Best Life Insurance Companies for Infinite Banking

Best Life Insurance Companies for Infinite Banking

Do you ever feel like your bank is holding you hostage? With traditional banks, you deal with their fees and pitiful interest rates. But what if there was a better way?

There is a proven approach to personalized banking known as the “Infinite Banking Concept” which allows individuals to become their own bank. This approach was developed by economist Nelson Nash and provides people with the ability to access their money at any time by borrowing from themselves and then repaying back into the account. Using this method gives you much more flexibility than traditional banking options. We wrote an in-depth article about infinite banking here. 

What we look for in a company for Infinite Banking

If you are considering the Infinite Banking concept so that you can finance major purchases with your own money, check out the following recommended guidelines to get your bank up and running:

  • A mutual insurance company that offers dividends and has a great reputation for paying dividends on whole life insurance policies.
  • One with very high ratings from all of the national rating companies.
  • One that offers policies that are “non-direct recognition” so that your dividends will not be impacted by policy loans.
  • One that allows you to receive dividends as paid-up additions which creates additional “mini-policies” that will also earn interest and dividends. Doing so helps your bank receive funding sooner.
  • One where you can purchase a whole life policy with a 10-pay periodic premium so that your cash value account will grow quickly enough for you to borrow funds as soon as possible.
  • One that offers a “cash value” rider to your policy so that your designated beneficiaries will receive the death benefit PLUS the cash value of your life insurance policy.

Our Top 5 Insurance Companies for Infinite Banking

Now that you understand the Infinite Banking concept, it’s time to choose a whole life insurance company that will be best suited to meet your expectations going forward. Here are the top five that we recommend:

Mutual Trust

Criteria Result
Mutual or Stock Company? Mutual
Dividend Payment Performance Level or increased since 1909
Loan Interest Rates 4% for 2022
Financial Stability A.M. Best: A (Excellent)
Product Flexibility Multiple periodic payment plans
Direct or Non-Direct Recognition Direct Recognition
Rider Availability 10 riders to choose from

Personal uses may include: Educational funding, debt management, retirement income, income replacement, estate planning, mortgage protection, gifting and more. 

Business uses may include: Buy/sell funding, key person protection, executive bonus programs and deferred compensation.

Mass Mutual

Criteria Result
Mutual or Stock Company? Mutual
Dividend Payment Performance 6% for 2022 – 15 yr average of 7.14%
Loan Interest Rates 5% to 8%
Financial Stability A.M. Best A++ (Superior)
Product Flexibility 10, 20, age 65, and 100 pay
Direct or Non-Direct Recognition Direct and Non-Direct Recognition
Rider Availability 6 optional riders to choose from

MassMutual is one of the highest rated life insurance companies in the United States. Its strong financial position and high customer satisfaction ratings indicate that it is positioned to continue to be a leader in the life insurance industry.

National Life

Criteria Result
Mutual or Stock Company? Mutual
Dividend Payment Performance 5% since 2019
Loan Interest Rates Calculated at time of the loan
Financial Stability A.M. Best A+ (Superior)
Product Flexibility Whole Life, IUL and Term
Rider Availability 10 optional riders to choose from

A flexible premium product that allows extra premium to pay-up portions of the policy. Low required premium, strong death benefit, high cash value guarantees.

Ameritas

Criteria Result
Mutual or Stock Company? Mutual
Dividend Payment Performance 5% or more over the last 10 years
Loan Interest Rates 0% plus
Financial Stability A.M. Best A
Product Flexibility 10 pay, 20 pay, pay to age 65, and 100 pay
Direct or Non-Direct Recognition Direct Recognition
Rider Availability 6 optional riders to choose from

Ameritas Life Insurance offers a wide variety of policy options to choose from, all with different features and benefits. You can tailor your policy to fit your specific needs, and even add on additional riders to further customize your coverage.

Penn Mutual

Criteria Result
Mutual or Stock Company? Mutual
Dividend Payment Performance Level or increased for more than 10 years
Loan Interest Rates 5% for 2022
Financial Stability A.M. Best: A+ (Superior)
Product Flexibility Multiple periodic payment plans
Direct or Non-Direct Recognition Direct Recognition
Rider Availability 7 riders to choose from

For 2022, Penn Mutual is set to payout $123 million to eligible policyholders with a dividend interest rate of 5.75%.

Conclusion

All of the life insurance companies listed above would be excellent choices to fund your Infinite Banking plan. We do however want to help you build out the perfect Infinite Banking Plan.  Give us a call to learn more about you and what plan design will work the best.