Executive BenefitsFor many small and medium-sized companies Life Insurance is an excellent way to protect against the threat of unforeseen events disrupting the continuation of a business and succumbing to overwhelming debt. This is why life insurance can provide protection to a business when the owners and partners have adequate coverage. Also, many times buy-sell agreements are funded by life insurance benefits.
An Executive Bonus Plan, also referred to as a Section 162 Plan, is a common way to reward top level employees. In this situation the executives or partners buy a permanent life insurance policy which they own. They determine the benefit structure and cash value which accumulates tax-free over time. The company pays for the premiums in the form of a bonus that is usually considered a tax-deductible business expense. Click here to find out more about LIFE INSURANCE options.
Supplemental Disability Income Insurance is another tool used for executive-level benefits. Most group long-term disability coverage is for sixty percent of gross income but there is a maximum. Highly paid executives usually exceed the maximum benefit. To rectify the percentage discrepancy, employers can purchase supplemental individual disability policies for these executives to bring their total benefit on par percentage-wise with all of the other employees.
Executive carve-outs are also possible with Long Term Care insurance, since ERISA rules do not apply to long term care benefits.
An experienced Asset MarketPlace advisor is available to discuss all of these options so you can determine what would work best for your company.
Contact us today for more information.
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