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Infinite Banking in Langley

A participating policy is a thirty-year commitment made by two people. Nobody selling one mentions what happens if the two people separate, and in British Columbia the answer is specific.

The City and the Township

Langley is two municipalities sharing a name: the City of Langley, a compact urban core, and the Township of Langley surrounding it, which is far larger and holds most of the farmland. Fort Langley on the Fraser was the Hudson's Bay post where British Columbia was proclaimed a colony in 1858, and much of the Township sits inside the Agricultural Land Reserve. The SkyTrain extension along the Fraser Highway is under construction now.

What matters here is household composition. Langley has a high proportion of families with children at home, which makes it the right place to say the thing this subject usually leaves out.

What separation does to a policy in British Columbia

This is the page's central point, and it is not pessimism. It is arithmetic. A contract asking for premiums maintained without interruption for thirty years will, for some households, outlast the relationship that started it. That has to be planned for while things are good, because it cannot be planned for afterwards.

Under British Columbia's Family Law Act, property acquired during the relationship is generally family property, and that can include the cash value accumulated in a policy. The specifics depend on when the policy was taken out, whose income funded it, whether an agreement exists, and what a court or the parties decide. This page cannot tell you the answer for your situation and neither can any practitioner: it is a family law question, and it needs a family lawyer.

What can be said generally is what to check. Who owns the policy, which is not always who pays for it. Who the beneficiary is, and whether that designation is revocable. Whether the policy is named in any cohabitation or marriage agreement. And whether the premium can be carried by one income, because after a separation it will have to be.

A common-law relationship of two years or more is treated substantially like a marriage under that Act, which surprises people. If you are in one, that surprise is better had now.

Beneficiary designations outlive relationships

A designation made in 2010 and never revisited will pay whoever is named on it, regardless of what has happened since. Policies pay the named beneficiary, and a will does not override a valid designation.

Review the designation after any separation, any remarriage, and the birth of any child. It costs nothing and takes one form. Households that skip it produce the outcome nobody intended and nobody can undo.

What the strategy asks of a family household

Premiums maintained without interruption for decades. Cash surrender value stays below cumulative premiums for many years, commonly more than a decade, so an early exit is a loss, and a separation is a common cause of an early exit.

Size the base premium against one income rather than two where you can, and put the second income into paid-up additions. In most contracts the base premium is the binding obligation and additional deposits are the flexible part. That structure is worth having for its own sake, and it happens to be the structure that survives a bad year of any kind.

British Columbia rules and where it does not fit

Insurance in British Columbia is regulated by the Insurance Council of British Columbia, and a professional here holds a Life Insurance Agent licence. Verify it in the Council's public register and ask how the person is paid. British Columbia has no title protection statute of the kind Ontario, Quebec and New Brunswick have enacted, so titles carry less information here than elsewhere.

A household early in a mortgage, without an emergency reserve, or carrying high-interest consumer debt should deal with those first. Nothing on this page is advice, and nothing on it is legal advice about family property. No assessment has been made of anyone reading it, and the author is not a neutral party: he is licensed to sell the contracts this strategy uses and is paid a commission when one is placed. If you have a cohabitation or marriage agreement, bring it.