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Guidelines |
Routine Requirements |
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The amount must be justified for the deferred compensation and/or the reverse split dollar program |
Always needed: Gross annual earned income on the application. For cases $250,001 or more: A financial questionnaire will be requested. Third party financials from a CPA will be required for applications of $2 million or greater. Examples are a current income statement and balance sheet. |
These arrangements are used when someone with the need for life insurance and someone else with the ability to pay premiums agree to purchase insurance and share in the proceeds. Each plan is custom-tailored and is not limited to any particular business relationship. An employer/employee relationship is the most common with the employer paying the premium.
It is always important to integrate possible purposes to avoid situations where the same loss is covered more than once, i.e., personal income replacement versus deferred compensation coverage, charitable remainder trust versus overall estate protection.