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Best Life Insurance Company for Infinite Banking - YouTube
Channel: The Money Advantage
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one of the questions I hear fairly often
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is which insurance company is best how
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do I know that I'm working with the
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right insurance company and specifically
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in the area of life insurance now what I
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want to do is give you the criteria to
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figure out which is the best insurance
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company and if you came to this video
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hoping that I was going to name the best
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insurance company I hate to disappoint
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but we're not going to do that I do want
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to give you the criteria for evaluating
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if the insurance company you're talking
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with and working with is right for you
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now the second thing is I want to
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differentiate between an insurance
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carrier which is the actual provider of
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the insurance itself and the agent or
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financial advisor that you're working
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with who is helping to facilitate your
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decision and they are selling you a
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product of the insurance company so
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we're gonna actually talk about both but
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first I want to focus on the insurance
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carrier or the insurance company
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themselves number one that needs to be a
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mutual company what do I mean a mutual
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company with an M is different from a
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stock company a mutual company is
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actually owned by the policy holders
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meaning that that is their number one
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interest and they pay dividends to the
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policyholders when there's an overage in
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their profit above what they need to
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keep in reserves so that means that you
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as a policy owner are one of the owners
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of the company and you have a right to
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earn a portion of the company dividends
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now this is different from a stock
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company who has stockholders who are
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different from the policy owners and a
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stock company then has an obligation to
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pay out and improve the value of its
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stock for the stockholders which is a
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different party than the policy owners
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so you want a mutual company that's
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where you're going to have the return of
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company profit to you as a policy owner
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in the form of dividends now moving on
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to the security and stability of the
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company there are several rating
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agencies that provide public data about
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the financial strength of insurance
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companies you can find this through
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Standard & Poor's Fitch's am best and
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they will assign a letter
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Grainne to the insurance company which
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changes from year to year and this is on
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the basis of their financial strength so
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it is an assessment of all of their
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holdings their reserves where they're
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invested and the length of time they've
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been in business it really helps you to
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evaluate everything and the financial
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strength all at once
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now we recommend working with companies
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insurance companies that have at least a
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score with those rating companies of a
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or better so you're not wanting to work
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with B and C type companies you really
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want to work with the a companies next
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you have something called a Comdex score
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and that is a score assigned to each
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insurance company on the basis of
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several industry ratings and that ranges
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between 1 and 100 100 being the best and
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one being the worst now we recommend
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working with companies that have a
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Comdex score of at least 80 or better
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now the fourth thing you want to look at
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is that you want an established company
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that has a long history of paying
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dividends now what I mean is that when
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we work with certain insurance carriers
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we want to make sure that they have a
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long history of paying dividends for at
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least a hundred plus years that means
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that they have weathered the Great
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Depression they've weathered the Great
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Recession and they have continued to be
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profitable and pay out dividends during
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that time to the policy owners if you're
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talking with a company that has a
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shorter history of being around or
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they've had gaps in the dividends that
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they've paid that's not a company that
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you want to rely on you want to really
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know that they have a long history of
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pay not dividends now I want to switch
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over for just a moment to talk about the
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agent or the financial adviser company
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that you're working with one thing that
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is really important is to make sure that
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they have a succession plan in place now
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in the financial services industry a lot
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of times you'll have advisors who are
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great advisors but who are working with
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you one-on-one and when or if something
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happens to them or their business or
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they leave the industry or they pass
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away you are in a position where you're
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left without someone who can continue on
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that plan and trajectory for you so you
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really want to be
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working with a company that has an
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established succession plan that has
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more than one person in the meeting with
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you that has other advisors who are
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knowledgeable about your plan and what
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you're doing so that they can help carry
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that on no matter what happens to your
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primary agent that just gives you a lot
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of peace of mind and clarity and
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confidence to know that your plan is
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going to last longer than just the agent
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that you're working with now in that
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summation of five things we just
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discussed you'll notice that I did not
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say two really important things that
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might have been on your radar one is I
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did not say dividend rates are the
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number one determination of which
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insurance company is best I also did not
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say that it has to be a direct or non
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direct recognition company here's why
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dividend rates the actual percentage of
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expected dividend that will be paid to
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the policy owners is projected from
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year-to-year by each insurance company
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and at one time a particular company may
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show a higher dividend scale than
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another company so if you received an
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illustration today in 2019 you may see
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that company a has a higher dividend
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rate than Company B however if you
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looked at that same illustration maybe
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ten years ago you may have seen an
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opposite difference you'll also note
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that sometimes some companies are very
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accurate with their forecasting of
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dividend rates where other companies
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might project high and then end up
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coming in thousands of dollars less than
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what they told you so you really don't
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want to use a dividend rate to base your
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decisions on so one company might show
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that they have a higher dividend and
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higher performance throughout the
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lifetime of the policy however don't be
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fooled by that because it's not
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necessarily a guarantee if you're
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looking at dividends which are on the
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non guaranteed side of your illustration
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you'll note that those do fluctuate each
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year and cannot be the sole thing that
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you make your decision about which
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company or which illustration is better
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for you the other thing is with direct
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and non direct recognition this has to
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do with how you are credited dividends
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based on whether or not you have a
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policy loan what you'll end up noticed
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is that the companies that credit you a
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full dividend for all of your cash value
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normally will have a lower dividend than
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the companies that credit you only the
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portion of your cash value you do not
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have a loan against and so this again is
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one of those sticking points that a lot
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of people bring up and get stuck on but
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it's not the main thing to help you make
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decisions on which insurance company is
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best for you so again you want a high
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rating even a high Comdex score at least
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over 80 a rating over a you want a long
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history of paying out dividends at least
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a hundred years you want a mutual
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company and then you want to make sure
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your financial advisor team has a
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succession plan in place to really serve
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you and your financial goals and
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objectives through the end of your life
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so you can really achieve time and money
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freedom hey I hope you liked this video
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if you did click the link in the
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description box below for more
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