Economic Benefit Regime/Endorsement Split Dollar – Paying for death benefit protection with company dollars

A Split Dollar plan allows a business to assist an employee with the purchase of needed life insurance protection by paying all or a portion of the premiums. In an Economic Benefit Regime/Endorsement Split Dollar arrangement, the business is the owner of the policy. The business also owns the rights to the policy cash values. The employee’s beneficiaries receive a death benefit through an endorsement. Thus the employee can receive valuable life insurance coverage at a reduced cost.