Life Insurance for Business
What is deferred compensation life insurance?
Deferred compensation life insurance is used to fund non-qualified deferred compensation plans for executives. The business purchases life insurance on the executive, and the cash value is used to fund the deferred compensation obligation. The executive receives the deferred compensation at retirement.
Key Points
- Deferred compensation: executive defers income to retirement
- Business purchases life insurance to fund the deferred compensation obligation
- Executive receives deferred compensation at retirement
- Non-qualified plan: no ERISA restrictions
- An independent agent can help you evaluate deferred compensation life insurance