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For a business to be successful, it needs to attract and retain quality employees. One way to do this is through adding life insurance to your benefit plan. A group plan can provide life insurance protection to all employees for as long as they remain employed. Coverage is usually based on an employee's salary.
For key employees, you also have the option of providing even greater compensation - the executive bonus, also called a Bonus 162 plan. With an executive bonus plan, the corporation pays the executive additional compensation to cover the policy premium. The executive owns the policy, names the beneficiary, and has all rights to the policy. The employer has no rights in the policy's cash values or death benefit. The executive bonus can be used in addition to a group term plan when the employer wants to select key employees to receive additional life insurance protection.
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| Benefits to the employer |
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The executive bonus plan is an effective method to attract and retain key employees – employers can choose who may participate. |
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The plan is easy to explain and administer – IRS approval is not required. |
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Because the amounts contributed as premiums to the policy are treated as cash compensation, the business benefits from an immediate tax deduction. |
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| Benefits to the employee |
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The plan helps provide an additional layer of security and protection for the employee’s family. |
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Policy cash values accumulate tax-deferred and can be used as a source of retirement income. |
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The employee owns the policy, even after leaving the company. Continued premium payments, if any, become the employee’s responsibility. |
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| Help your business clients attract and retain the key executives they need to keep their businesses alive. Have them implement a Executive Bonus Plan. Get a quote now. |
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| Marketing tools to support the sale |
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| Business Solutions Brochure LS-6371 |
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| Executive Bonus Plan Brochure LS-6249 |
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| Executive Bonus Customer Mailer LS-6250 |
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| Executive Bonus Plan Prospecting Letter LS-6281 |
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