One of the most valuable traits an IBC practitioner can have is patience - you need to be able to “think long range”, as Nelson put it.

Which brings us to today’s topic: short pay and long pay policies.

This is a hotly debated topic amongst life insurance agents and there is a lot of confusing, contradictory advice out there. Today, we are going to weigh in on the matter and help explain these policy design approaches and how they pertain to the Infinite Banking Concept®.

Remember, everything in the insurance business is a tradeoff between cost and risk. There is no free lunch. So what are the tradeoffs when it comes to short-pay and long-pay policies for the purposes of deigning a whole life insurance policy for IBC?

This is super-important information so please give this one a listen!

Episode Outline:

0:00 - Introduction

0:12 - Episode beginning

2:55 - Some more context on “short pay”

7:27 - Why do people write short pay policies?

12:04 - Two other reasons that short pay policies have gotten more popular

16:07 - Another trade-off and long-term payments

18:06 - A policy becoming “paid up” and some more trade-offs

23:07 - Another trade-off, lower death benefit

24:24 - “Using your flexibility” and how it affects performance

27:29 - “The ability to go down”

29:45 - Measuring the performance of both

35:35 - The rule of thumb and where you would do a short pay

40:51 - The IBC mindset

43:19 - Episode wrap-up