Corporate Life Insurance: Providing It For Your Employees

corporate life insurance dickran kabarajian kabco benefitsCorporate life insurance is typically used to protect top level, senior executives within a company in case of accidental death, sickness, etc. Sometimes, corporate life insurance is also purchased by companies who wish to provide extra benefits to employees. Benefits can be paid to either the company insuring the employees or to the employee’s family.

Why is purchasing corporate life insurance for your employees a good idea?

  • Protect your investments if you’ve given intensive training to your employees

  • Protect your company if employees are essential to the operations of your company. In some industries/businesses, certain employees can be the key to the whole company, therefore protecting their role is necessary.

  • If the employee’s family will be the beneficiaries of the policy, this provides an extra layer of benefits to your employees, essentially creating happier employees because they know their family is protected, also if funded with a permanent policy it can provide money and an income stream in retirement as well.

  • Life Insurance can provide the funding of a properly executed Buy Sell Arrangement to insure continuation and ease of transfer of a Business to a surviving shareholder

  • Non Qualified Deferred Compensation can be funded with Life Insurance to add to an executive’s compensation on a tax preferred basis.

What are some important things to note about providing corporate life insurance?

  • If you are purchasing a life insurance policy for an employee, you must assure that each and every employee is aware of any policies in their name

  • If your company or corporation will be the beneficiary of such policy, you must assure that your employee(s) knows this and that it is clear that their families will not receive any portion of the benefits.

  • Like other life insurance policies, the benefits from corporate life insurance policies are also income tax-free.

 

Do you own a company or a business whose employees are the key to everything? Do you want to provide an additional benefit and security blanket to your employees? Contact Kabco Benefits to help find the best suited benefits for your corporation.

 

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