Death Benefit Only
This simple and cost-effective plan promises select employees that in the event of their death while covered by the plan, their named beneficiary(ies) will receive the death benefit specified under the plan. The business could purchase a life insurance policy on the key employees to help fund the liability, which could also provide key person coverage.
Benefits and considerations for the employer
- Lower cost, convertible option. Term insurance may be used to informally fund the plan. In future years, this Term policy can be converted to a permanent life policy as organization goals change.
- Be selective. Plan participation can be made on a selective basis; no need to provide the same benefit to all participants.
- Receive a tax deduction. When the death benefit is paid to the beneficiary(ies), the employer generally receives an income tax deduction.
- Communicate easily. The simple and flexible plan design is easy to communicate and maintain.
- Recover premium cost. If the death benefit purchased is higher than the amount promised to key employee(s), the difference can be used to recover the cost of premiums paid and/or provide key person protection for the business.
Benefits and considerations for the key employee
- Peace of mind. Knowing their named beneficiary(ies) will receive a death benefit can provide comfort to key employees that their loved ones will be financially protected in the event of their death.
- No current tax impact. Employees don’t report any benefit amount as income during their lifetime.
- Must qualify. Key employees must be healthy enough to qualify for the life insurance policy. To simplify the application process, a Guaranteed Issue option may be available for 25 or more plan participants.
- Tax impact to beneficiaries. The payment of the death benefit will be treated as taxable income to the beneficiary(ies). Part of the death benefit they receive could be used to pay the tax.
Guaranteed Issue Term Program Overview - Employer (BB12437)
Shows how this innovative program can be a simple and affordable option to finance business solutions—while leveraging the benefits of life insurance with lower costs and fewer medical requirements. Not for use in Mississippi at this time.
View (PDF) • Order
Key materials listed below.
Before the Sale
Employer overview flyer (BB12449)
Use with employers to provide an overview of the plan and how it works.
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During the Sale
Sample Proposal (BB12452) | Request for Proposal (BB12448)
View this sample of a complete customized proposal that includes details on plan design, benefits, and considerations.
View Sample Proposal (PDF) • View Request for Proposal (DOC)
Financial Models: Shows samples of the financial models and illustrations.
After the Sale
Participant overview flyer (BB12463)
Use this summary with participants to explain the benefits of the plan and how it works.
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BMA Services Flyer (BB9441)
Outlines the added benefits employers and plan participants get from our administrative services through Business Market Administration (BMA).
View (PDF) • Order
Sample Agreement (BB12467)
Contains some of the important issues to assist the client's attorneys with drafting the actual agreement.
View (DOC)
GI Term - Key employee benefit implementation email - for employer (LF1334)
Provide the employer this email template to use when communicating the enrollment process for their key employees.
Get Email (OFT)
GI Term - Key employee benefit enrollment email - for employees (LF1335)
Provide the employer this email template to use when communicating the enrollment process for their key employees.
Get Email (OFT)
Key materials listed below.
Business Case Submission Checklist (DD849R)
Form that must be used when submitting Life applications to BMA to fund business solutions.
View (PDF)
Advanced Markets Information
Technical material for applied knowledge on a specific topic.
View Advanced Markets Information
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