LIFE INSURANCE FOR HIGHLY COMPENSATED individuals
Executive UL is an institutional purchase (employer paid) life insurance program on the lives of a distinct group of highly compensated employees without exception, delivered by the issuance of individual insurance policies, underwritten on a guarantee issue type basis.
[ key facts ]
[ Highlights ]
– Corporate Paid Program (not voluntary)
– Guarantee Issue Type Program
– Eligibility: White Collar workers earning $100,000 or more
– Individual Current Assumption UL policies
– Ability to pay minimum premium (COIs only)
– Minimum Premiums Rate Schedule Guaranteed for 5 years
– Minimum Death Benefit: $100,000
– Maximum Death Benefit: $5,000,000
– One medically related question, Ages 18-70; Ages 71-80 additional questions
– Portable without change to death benefit amount nor pricing
– Required Insured Lives: 25+
Formula to determine maximum death benefit on a case
Lives — 25-49: 40K per life (ex: 30 lives = $1,200,000)
Lives — 50+: 50K per life (ex: 50 lives = $2,500,000)
Minimum Annual Premiums: Year 1
Gender distinct; unismoke
[ Sales Opportunities ]
Executive Sample Cases
A better model of coverage for employees
Employer had group term life for all employees. Carved out employees earning $100,000 or more (52). Benefit design: two (2) times salary to $1,000,000.
Portable without changes. No reductions at 65, 70, or 75. Group insurance rate reduced.
Create More Coverage
Obtaining more death benefit
The group term coverage could not deliver enough death benefit. Partners in the law firm (91).
Partners provided $3,000,000.
Replace Competitor Plan
Obtaining lower cost and better provisions
The hospital had a group variable universal life program. Confusing and an administration nightmare. Portability restrictions caused liability concerns.
Changed to Executive UL:
- Lower premium (15% a year)
- 5-year rate schedule guarantee
“Individual” Policy type allowed for Corporate Ownership
Investment Firm (36)
Fund their existing stock redemption plan.
Insured: Employee and Stockholder
Able to insure a specific formula (up to a maximum of $1,750,000). Able to provide increases in coverage.