Executive benefit plans are designed to provide meaningful value to a company’s key people. They can be implemented as a supplement to a base group plan or as a standalone plan for the executive group. Generally, the executive group can be defined to suit the company’s total rewards strategy for high-value employees, specifically:
- Recruit: a new talent to help advance and grow the company
- Retain: high-value employees
- Reward: key team members for their impact on operations
Subject to regulations and limited by tax implications, executive benefits plans can be as broad and creative as desired. Noble Insurance Planners can help with your executive benefits strategy in the following areas:
EXECUTIVE LIFE INSURANCE
The basic group term life insurance provided by employers is a valuable benefit to most employees, but it is much less meaningful to the management and executive team relative to their salary level. An executive life insurance plan can right-size the amount of death benefit for the highly paid employees.
SUPPLEMENTAL DISABILITY INSURANCE
Disability insurance is income insurance. Short-term disability insurance generally applies to all employees in the same manner. With long-term disability (LTD) plans, however, there is typically a gap for higher-income earners. This gap makes the group LTD plan more cost-effective but creates inequity for the most valuable employees.
- A supplemental disability insurance (DI) plan allows cost-optimization with the group LTD plan while providing full 60% income replacement coverage for the executive group.
- Supplemental DI Plans start where the group LTD plan ends and can come with a guaranteed issue layer. Policies are portable and can have rate guarantees.
LONG-TERM CARE INSURANCE
Long-term care insurance (LTCi) should be viewed as wealth insurance, protecting against rising long-term care costs. Although traditional, standalone LTCi has been around for years, there are better products and strategies for executive groups, such as Executive LTCi funding, Cash-value life insurance with LTCi rider, or Life Insurance/LTCi Hybrid Policy.
NON-QUALIFIED RETIREMENT PLANS
Qualified retirement plans, such as a 401(k), are powerful savings tools, given their tax advantages, investment options, and transferability. There are, however, several critical limitations, especially for high-income earners. Contribution limits, distribution limits, and discrimination testing all impact the effectiveness of the executive group. As income levels go up, qualified plan limitations cause larger gaps in a retirement savings fund.
Non-qualified plans are ideal solutions to fill these gaps. They are customizable with respect to participants, pre-or post-tax contributions, investment options, and distribution amounts. Also, there are various funding options, including tax-advantaged strategies.
EXECUTIVE COMPENSATION CONSULTING
Executive benefits plans are implemented under the guidance of a greater executive compensation plan or philosophy—a total rewards package. There is inherently a give-and-take between the cash compensation and benefits in that package. We can help with both pieces.
SPECIALIZED LINES OF INSURANCE SPECIFIC TO EXECUTIVES AND EXECUTIVE COMPENSATION
Other insurance strategies are specific to executives and the sphere of executive life.
We also can assist you with the following by contact us:
- Aviation insurance for corporate aircraft
- Kidnap and ransom
- Temporary medical coverage for foreign travel
- Fine art coverage