Non profits are always looking for ways to do more with less. These organizations are accountable to their Boards of Directors, donors, and to government oversight post submission of their form 990.
All things considered, non profits are held to a higher standard and are expected to use their funds in the most efficient way possible.
One way that non profits can use their funds more efficiently is by using corporate-owned life insurance (COLI) to fund executive compensation packages.
Let’s listen below to David Jacobs, Principal at Acumen Insurance Solutions talk about this more.
What is Corporate-Owned Life Insurance?
Corporate-owned life insurance, also known as COLI, is a type of life insurance, owned by a corporation, where the death benefit can be used to help the corporation pay for expenses such as executive compensation packages, employee benefits, and other business costs.
The Benefits of Corporate-Owned Life Insurance
COLI is a safe and liquid investment that can offer many benefits to corporations. It can help them:
- Keep pace with executive compensation packages
- Attract and retain the best employees to fulfill their mission, and
- Earn better yields to better meet the needs of their community beneficiaries
When used correctly, COLI can be a powerful tool for corporations. It can help them save money and provide many other benefits that can help the business succeed.
A Final Word
Using COLI to fund executive compensation packages is a smart way for non profits to use their funds more efficiently and effectively. It is a win-win situation for both the non profit and the executive, and it can help the non profit fulfill its mission in a more impactful way.
Interested in learning how your organization can use COLI? Read on to learn how non profit organizations achieve their key person acquisition and retention goals by using supplemental executive retirement plans funded with life insurance. Then, reach out to our Acumen team today for a free consultation.