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Split-dollar insurance plan
A
type of business insurance in which an employee
is covered by individual life insurance that is
paid for jointly by the employee and the employer.
The employee names the beneficiaries. Each year
the employer pays the portion of the premium that
is equal to the increase in the policy's cash value
for that year, and the employee pays the balance
of the premium. If the employee dies, the employer
will receive an amount of the proceeds equal to
the cash value of the policy, while the beneficiaries
of the policy will receive the remaining benefits. |
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