| As a business
owner, chief financial officer or board member, you have a
responsibility to your company to make sure that business risk
is minimized. Key employee insurance is a cost effective way
to eliminate the unnecessary business risk associated with
the disability or death of a critical contributor to your organization.
But what if a key employee decides to leave your company to
start their own business or even worse takes a position with
a major competitor? Key employee retention is essential to
the continued success of any company. Structured properly,
key man insurance can provide a valuable executive benefit
to the employee while at the same time tying them to your company.
As a business grows and profits increase, it is important
to compensate and reward key employees who are responsible
for the company’s success. A well designed executive
benefit plan is essential if a business is going to retain
its talented employees and executives. Bonus arrangements
and nonqualified deferred compensation plans are attractive
alternatives to provide additional life insurance incentives
as well as supplemental retirement income opportunities to
these key people.
Executive compensation arrangements may allow the business
to selectively choose which employees will participate in
the benefits plan. Additionally, they don’t have the
regulatory burden associated with other qualified benefit
plans. Some of the more attractive available plan options
include the executive bonus plans, supplemental executive
retirement plans (SERP) and other deferred compensation arrangements.
For more information on executive benefit planning and key
man insurance, please see:
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