Business Challenge
Company ABC needed a benefit that would attract and retain highly skilled employees without permanently increasing payroll, while also creating long‑term corporate value. Traditional benefits created ongoing expense but no balance‑sheet asset, and did not meaningfully differentiate the employer in a competitive labor market. In addition, traditional underwriting created participation and equity challenges for employees with medical histories.
Solution
Company ABC implemented an employer‑owned, guaranteed‑issue permanent life insurance program for full‑time employees.
• Employer pays 100% of premiums
• Employer owns all policies
• Guaranteed issue for eligible employees age 65 and under
• Tiered coverage: $250,000 or $500,000 based on salary
• Permanent coverage with living benefit rider
• Annual enrollment cycle only
Employer Benefits
• Balance‑sheet asset: Corporate‑owned policies build cash value over time.
• Internal capital reserve pool: Policy values may serve as a controlled source of liquidity.
• Cost recovery potential: Long‑term recovery can be aligned with future cash values or death benefits.
• Highly customizable platform: Can support vesting schedules, golden parachute, supplemental retirement income, or key person protection
• Attraction and retention leverage without deferred compensation complexity.
Employee Benefits
• No out‑of‑pocket cost.
• Guaranteed access to permanent life insurance.
• Living benefit protection through a terminal illness rider.
• Long‑term family protection instead of expiring term coverage.
Outcome
The company strengthened its recruiting position, created natural retention and motivation incentives, and began building a corporate‑controlled asset and internal capital pool—transforming a traditional benefit expense into a long‑term strategic resource.