- Client Profile
- Desire to protect business against loss of key employees.
- Desire to create a retention tool to protect key employees from competitor poaching.
- Solution Opportunity
- Similar to key-person coverage, in that corporation owns UL on key employee(s).
- Corporation pays the COI for the coverage, employee pays overfunding dollars.
- Upon death of insured, cash values are paid to insured’s family/beneficiaries, while face amount is paid to corporation, creating CDA room.
- Split Dollar Agreement must be drafted by a lawyer, and all parties should obtain independent legal advice. Any splitting costs and benefits are determined by the Split Dollar Agreement, not the insurance policy.