Insurance Agent Forum

[djanema1]

Ok,

I was watching Countdown with Keith Olberman last night and he started talking about COLI insurance, sounds like a disease and thats what it should be labled as

Definition:


[COLOR=black]A life insurance policy that is taken out on employees for the benefit of the corporation. The company pays the premiums. Tax breaks can be earned for five years on the cost of the premium. COLI differs from group life insurance, which is provided to employees as a benefit and is payable to a beneficiary that the insured employee chooses. COLI has come under fire for the large tax breaks it generates and for the fact that it pays the company when an insured person dies even after the person has left the company or has retired[/COLOR]


[COLOR=black]I have to say after learning about this it makes me sick to my stomach. Isnt Life insuarnce meant to protect the persons family in case of a death[/COLOR][COLOR=black]]what do you guys think? [/COLOR]

[ABC]

This is Key Man insurance.

Most of the time it's used to offset the loss that occurs from the death of a owner, partner, Executive, and other positions of high responsiblity.

This is a perfectly acceptable way to offset risk in any type of corporation. I would think most of these policies are now sold on the term platform. So it would be tough for a company to benefit from a retired employee's death. That would be a lot of premium dollars to lay out on a permanent policy.

[Franz Kafka]

Do a little reading on COLIs. You'll quickly find out why Oberman is such a complete moron on the subject. There are a lot of uses for permanent COLIs besides Key Man.

[briko3]

I saw something similar to this the other day as well. The problem wasn't with protecting the company against the loss of a key employee, but rather these companies were buying policies on minimum wage employees. Since it can't be bought without their knowledge, these companies were hiding the wording in their work contracts.

[TristanTLC]

COLI is a perfectly acceptable form of insurance, in many forms. It's the STOLI you have to worry about! The COLI is a legitimate way for corporates to protect their assets from financial loss. If a Key person in the corporation passes away, that corporation has to replace that person; which takes time, effort, and lots of money. That is all insurable interest.

[saieddie]

Heres the link to dummies rant:

Countdown with Keith Olbermann Countdown with...

NAIFA responded:
http://www.naifa.org/newsevents/docu...Letterhead.pdf

Just further affirmation that you can believe about 1/10 of what these talking heads spew.

[Ron Van D]

MSNBC: the station with more letters in its name than viewers. Now you see why.

[djanema1]

You guys are to much,

I value the reporting of keith olberman, he actualyl cares about people and not the politics, he is sure better than that talking head bill o'rielly, and that hate monger glenn beck.

[saieddie]

Too bad he doesn't check his facts. I care about my kids more than politics, but it doesn't make me an authority on tax law.