Security Mutual Infinite Banking in 2026: An Honest Carrier Review

For years the working assumption in this space was that no insurance company would ever publicly attach its name to infinite banking. Carriers tolerated the strategy. None marketed to it openly. Security Mutual broke that pattern, and it built its identity around being the carrier that wants IBC business. That makes it worth a careful, neutral look rather than a quick dismissal or an easy endorsement.

Marketing hard to the IBC crowd does not make a carrier the best home for the strategy, and Security Mutual is the clearest case of that gap. The features that draw IBC practitioners in are real. So are the structural risks that come with a company this small.

At BetterWealth, we have structured more than 2,000 policies across all 50 states, and we hold access to Security Mutual alongside the other major mutuals we review for infinite banking. We have chosen not to make it a go-to carrier, and this review explains exactly why, in numbers. We cover what the company is, how its WL4U LP100 product behaves on both a cashflow and a front-load design, the loan and PUA mechanics, the math that decides whether borrowing makes sense, and the niche risks that sit under the marketing. We will also tell you who it actually fits.

If you want to see the actual cashflow and front-load illustrations, Alden walks through both designs on screen and we react to the ratings live in the full review:

01 / The problemWhat carrier choice actually solves (and what it doesn't)

Carrier choice solves for staying power, loan mechanics, and how well the product can be designed for cash value, not for which company shouts loudest about infinite banking. The single biggest mistake people make with a carrier like Security Mutual is treating enthusiasm for the strategy as evidence of quality. They are separate questions.

Security Mutual answers the enthusiasm question better than anyone. It is openly pro-IBC, it trains agents in the language, and it gives them client materials no other carrier offers. The harder questions are about financial strength, liquidity, and long-term performance, and that is where most of this review lives.

02 / The frameworkWhat does it mean to run infinite banking with Security Mutual?

Running infinite banking with Security Mutual means using a properly structured WL4U LP100 whole life policy as a capital base you borrow against, while the policy keeps compounding on its full value. That is the mechanical definition. The discipline layered on top of it is what we call The And Asset.

Nelson Nash pioneered the idea of using whole life insurance as a personal banking system in Becoming Your Own Banker. His insight holds: you either lose money paying interest to outside lenders, or you lose money to the opportunity cost of capital sitting idle. We respect that foundation. The And Asset builds on it with one rule the broader IBC teaching does not enforce.

Where IBC ends and The And Asset begins

IBC says you can use a whole life policy as a personal banking system for any purchase. The And Asset says you only deploy capital from the policy when the borrowed dollars will produce a return greater than the carrier's loan cost. Anything less is an expensive way to spend money. Many IBC marketers say you are paying yourself interest. You are not. The interest goes to Security Mutual. Your return is what your deployed capital earns elsewhere while the policy compounds uninterrupted, net of mortality and expense charges.

The distinction matters more here than usual. A carrier this focused on IBC marketing attracts a crowd that borrows for any reason. The discipline of borrowing only when the math works is what separates a capital strategy from an expensive spending habit.

The math has to work every time, or you do not borrow.

03 / Financial strengthWhy does Security Mutual's size and rating matter for a 30-year strategy?

Size and ratings matter because The And Asset only works over a long horizon, and a long horizon exposes you to the carrier's staying power. Security Mutual is a small company. For a multi-decade commitment, that size is never irrelevant, and here the ratings push it toward genuine concern rather than a footnote.

The ratings tell the cautionary part of the story. Security Mutual is too small to receive a COMDEX score, the composite that blends multiple rating agencies into one number out of 100. It holds an A- (Good) rating from AM Best, which is a solid insurance rating but a notch below the A+ and A++ carriers in this series. Its Weiss safety score is C-, the lower third of the fair category, which flags weak liquidity and a fair stability outlook. Ratings move every year, and these can improve, but this is where the company sits today.

Then there is the dividend. Security Mutual distributed about $21.5 million to policyholders for 2026, a healthy payout for its size. Its last verified dividend interest rate is roughly 5.85%, and the company has referenced a 6% figure that is not officially substantiated. Treat that rate as gross. Your cash value does not grow at 5.85%. It grows at the dividend net of mortality and expense charges, which is the figure that actually compounds inside the policy.

The lapse ratio is the number that gives us the most pause. Security Mutual's lapse ratio averaged 7% from 2020 to 2025, about 37% above the 5.1% industry average, and it has risen in four of the last five years. A rising lapse ratio means a growing share of policyholders are surrendering or exchanging policies. It is a satisfaction signal pointing the wrong way.

04 / How it worksHow a Security Mutual policy actually functions as an And Asset

A Security Mutual policy functions as an And Asset through five mechanical steps, and the order matters. The product is WL4U LP100, designed for cash value, and it uses a term rider that drops off after the early years. Here is the sequence we use when we structure one.

1. Structure for cash value. Minimize the base premium and load the paid-up additions rider as heavily as the IRS allows. The PUA rider is the engine. Without it, this is an expensive death benefit.
2. Choose the right rider. Use the scheduled PUA rider for steady, long-term funding, or the Combo blended-term rider for short-pay or variable-income funding. The Combo rider stops accepting PUA once its term component is exhausted, so it is built for short pays.
3. Fund consistently. Choose a cashflow design (the same premium every year) or a front-load design (more in year one, then level). Fund up until the term rider falls off for best efficiency, and keep the scheduled PUA at or above 75% of plan, because paying under 75% two years in a row lets the carrier remove the rider for good.
4. Let the early years capitalize. First-year cash value on a cashflow design lands around 75 to 85% of premium. Do not expect to break even on day one. You will not, and any illustration that shows it is fiction.
5. Borrow and deploy. Take a policy loan 10 days after initial funding, collateralized by your cash value, then deploy it into an activity that beats the carrier's loan cost and repay from the cash flow that activity throws off. The policy compounds on its full value the entire time.

On a well-designed cashflow policy, Security Mutual reaches the capitalization point, where a dollar of premium adds more than a dollar of cash value, around year four. Break-even, where total cash value catches total contributions, typically lands at year six for a healthy individual.

Cashflow design versus front-load design

The two designs solve for different funding personalities. A cashflow design keeps the premium level and produces a long-term IRR around 3.4% to 4.3% on current dividend projections, with first-year cash value near 84% on a strong build. A front-load design front-ends a larger premium in year one, then levels off, pushing first-year cash value into the high 80s and producing a long-term IRR around 3.3% to 4.2%. Both are competitive early. The gap shows up later.

The honest caveat applies to both. Security Mutual lands right in the pack for the first ten years, then its long-term growth lags larger mutuals because it pays a smaller dividend and carries smaller guarantees. Put a number on it: Penn Mutual's best high-cash-value design runs an IRR around 4.2% to 5.3% over a long horizon, against Security Mutual's 3.3% to 4.3%. That one-point gap compounds into a large dollar difference over thirty years.

Competitive early, behind later.

For a deeper walkthrough of how the PUA rider and base premium split drives all of this, we broke down policy structure here.

05 / The mathDoes the return clear Security Mutual's loan cost?

The return on whatever you deploy must exceed Security Mutual's loan cost, or you should not borrow. This is the entire test. Security Mutual uses a variable loan rate announced each year, so the number moves with the rate environment. At the time of writing, many carriers fall in the 5 to 6% range, but treat the specific number as a variable to verify with the carrier, not a constant.

Here is the structure of the decision. You borrow at the carrier's loan rate. Because Security Mutual is non-direct recognition, your dividend is unchanged whether or not you have a loan outstanding, so the policy keeps compounding on its full cash value. Your deployed capital earns its own return. If that return is higher than the loan cost, you are ahead on the spread, and the policy has done two jobs with one dollar. If it is lower, you have borrowed money to lose money slowly.

If the deal does not clear the loan rate, do not borrow.

06 / Recognition and loansWhy does non-direct recognition help, and how fast are the loans?

Non-direct recognition helps because it keeps your dividend predictable, and Security Mutual pairs it with the fastest loan access in the industry. Under non-direct recognition, the carrier does not adjust your dividend based on outstanding loans. The dividend you earn is the same whether you have borrowed against the policy or not. That makes the strategy easier to explain and easier to plan around.

The loan speed is the standout feature. Loans are available 10 days after initial funding, faster than any carrier we are aware of. The loan rate is variable and announced annually.

The $10,000 portal cap, and why it exists

Security Mutual limits portal-initiated loans to $10,000, and it is the only carrier we know of that also caps portal loan repayments at $10,000. Most carriers allow online loans up to around $50,000. Larger loans and repayments go through your agent or directly with the carrier. On the surface this looks like friction from a company that says it wants IBC business. The likelier explanation is that it fits the traditional IBC user who is recapturing interest on car-payment and mortgage-sized amounts, which stay under the cap, and who can set up a direct-draft repayment program for the rest. It is a real inconvenience for anyone borrowing in larger chunks.

07 / The PUA ridersHow flexible is Security Mutual's funding, really?

Security Mutual's PUA flexibility is moderate at best, and that is the part of the IBC pitch that does not hold up as well as the loans do. There are two ways to fund, and each carries a real limitation.

The scheduled PUA rider

The scheduled rider expects a set premium and gives you a payment band of 75% to 125% of that amount. Pay inside the band and you are fine. Go outside it, in either direction, and you have to work through your agent or the carrier to get the draft approved. If you pay less than 75% of what is scheduled, you can lose the ability to fund at the higher level. The cap drops, and you cannot raise it back without intervention. There is a backfill catch-up provision, but it is narrow and it disappears if you skip the chance to use it. Miss the rules and the carrier cuts your funding options at the knees.

The Combo blended-term rider

The Combo rider is far more flexible up front, and it is the better tool for short pays or variable income like sales commissions. Think of it as a gas tank. You start with a block of blended term, and every extra dollar of PUA you pour in converts term into permanent death benefit. Once the tank hits empty and the term is gone, you cannot add any more PUA. You are left funding a base policy. It is flexible for a short, heavy funding window, and limiting for the long haul.

One feature is genuinely useful. Security Mutual's waiver of premium covers the Combo rider, and even while your premium is being waived on a disability claim, you can keep paying paid-up additions. Many carriers freeze PUA funding during a waiver claim. This one does not.

Flexible for short pays. Restrictive for the long game.

08 / The risksBenefits and the niche risks that define this carrier

Security Mutual's benefits are real, and so are the niche risks that come with a small carrier built around one market, and pretending otherwise is how agents lose trust. Here they are, plainly.

On the benefit side: a 133-year dividend history, the most openly pro-IBC stance of any carrier, two workable PUA options, and the fastest loan initiation in the business. Those are genuine reasons it shows up on a short list for the right person.

The risks cluster around size. First, the company is small, with no COMDEX score, an A- rating, and a C- Weiss safety score. Second, it carries the highest lapse ratio in this series at 7%, and it is rising. Third, long-term performance lags larger mutuals after years 5 to 10. Fourth, and this is the one we weigh most heavily, the niche risk: Security Mutual holds about 22.6% of its portfolio in policy loans, roughly 4.5 times the average of comparable mutuals, which is a liquidity consideration, and its average policy is about $63,000 of death benefit against a $639,000 industry average. A book of many small policies compresses margins and increases servicing load. Two more from the agent side: the product runs above-average in complexity, rated about 6.5 out of 10 on consumer complexity because of the PUA and Combo rider rules, and agent support and illustration software are thinner than at the larger carriers, a direct consequence of the company's size. Bundle those together and there is enough pause for us not to feel fully confident placing it as a primary carrier.

09 / The fitWho is Security Mutual right for, and who isn't it?

Security Mutual is right for a smaller-policy buyer who values explicit IBC support, fast loan access, and non-direct simplicity, and is comfortable with a small carrier. It also fits a New York resident who wants an IBC-friendly carrier, since Security Mutual of New York writes in all 50 states. If you can identify a productive use for borrowed capital that beats the loan cost, the policy can do real work.

It is the wrong carrier for someone placing large premium who wants a big balance sheet behind it, for someone who prioritizes financial strength ratings, or for someone focused on maximum long-term growth. If you cannot name an activity that beats the loan cost, no carrier is right for you, and Security Mutual will not change that.

10 / Head to headSecurity Mutual against the alternatives

Against the capital tools entrepreneurs actually use, a Security Mutual And Asset policy trades day-one access for control, tax treatment, and uninterrupted compounding, with weaker financial backing than the larger mutuals. The table sets it against a HELOC, a 401(k), and a taxable brokerage account on the four dimensions that matter for capital strategy.

FAQSecurity Mutual infinite banking questions