Advantages of Business Overhead Expense Insurance
Reimburses the business up to the amount of the monthly benefit for actual expenses incurred.
Benefits from the policy can enable the business to survive during the owner’s disability.
What is an Exucutive Bonus Plan?
Definition:
An Executive Bonus Plan is a method of compensating selected key employees by paying the premiums of a life insurance policy on the employee’s life. An Executive Bonus Plan is one of the easiest supplemental benefit plans to create. Often, it is also the best choice for a business owner and/or key employee.
Also known as a Section 162 Plan, an Executive Bonus approach allows an employer to provide life insurance protection to selected employees in a way that may be tax-deductible to the employer.
The employer may choose the employee or employees to be covered, and the amount of insurance to be provided. The plan may be available to both stockholders and non-stockholder employees.
Benefits to the Employer
- Can reward key executives
- Selective participation is allowed (no discriminating rules)
Premium costs are tax-deductible - No Administration
- Amounts of coverage on various employees can differ
- Plan can be terminated with out IRS approval or restrictions
Benefits to Executive
- Executive owns policy and cash values. If he or she changes employers, policy is not lost.
- Policy may offer the potential for tax-deferred cash value accumulation.
- Accumulating cash values will help in emergencies, at retirement or for personal investments.
- The death benefit may be income tax free. See IRC Sec. 101a
- The Proceeds may be used for estate settlement costs.
We Help Make Implementing an Executive Bonus Plan Easier
Starting the process is as easy as picking up the phone and calling our office or filling out the form to the right.
No sales pressure, no confusing insurance language, no worrying about which company to select. We are an independent insurance agency and have access to a wide variety of insurance companies. Let us help guide you and make the process easier for you.