SPLIT DOLLAR WHOLE LIFE INSURANCE: AN INNOVATIVE TOOL TO RECRUIT THE BEST PEOPLE AND THE ULTIMATE INCENTIVE FOR THEM TO STAY.
Recruiting and keeping top tier talent has never been harder and it is only going to get more challenging as the largest demographic in history, baby boomers, exit the workforce. Competition for that top 10-20% is going to be fierce with companies, hospitals, medical and professional practices needing to “think outside the box” to get and retain the top talent. So how is this as a value proposition for your top people:
“If you join and help us build the business for at least the next five years, we will in turn make sure you and your family will be protected in case something happens to you, death or disability, for the rest of your life and will provide an additional tax-free income stream, on top of 401K or Roth Plans, when you retire. Whether you are still with us or not”.
Think that will grab their attention: Darn right it will! ProSolace can help you make the aforementioned value proposition a reality. We specialize in corporate-owned split-dollar whole life plans that provides incredible benefits for both the employee and the organization. To recruit the best and/or keep your best from looking elsewhere, ProSolace can craft a creative solution that is a win/win for all involved.
CLIENT PROFILE
Sabre Tech Consulting ▪ Los Angeles, CA
Sabre Tech is an IT Software Development and Consulting Group headquartered in Los Angeles, CA. The executive team was looking for a way to incent their key people to stay with the firm during the red-hot technology labor market of 2019. The company was hesitant to offer stock or ownership options and was looking for another way to make the seats “sticky” for their core developers and project managers.
The solutions we proposed was a “split dollar” life insurance plan that would be funded by the company for five (5) key employees over the next six (6) years. Working with the company’s attorney and the employees, we customized whole life policies that fit the individual needs of each employee and spelled out the vesting period and performance clauses and how the policy, cash value and death benefit, would be terminated or transferred at the end of the period.
The employee received an immediate death and long-term care benefit as long as they are with the company and if they satisfy the vesting criteria, substantial cash accumulation and a paid-up life insurance policy, with a multi-million death benefit, for the rest of their lives.
As of February of 2024, all five of the employees are still with the company and have been instrumental to the company’s almost 100% growth.