Topic: Bank-Owned Life Insurance

BOLI in the Age of COVID

The coronavirus pandemic has had a dramatic impact on companies across the nation, including financial institutions. Watch now to learn how COVID-19 is specifically impacting existing BOLI programs, new BOLI purchases and more.

BOLI Opportunities and Market Update 

Plan Sponsor and Advisor Webinar
August 25, 2020

Improving BOLI Yields by Optimizing Death Benefits

With persistent low interest rates over the last decade, bank-owned life insurance (BOLI) owners have seen the impact on their cash value yields. While many focus on these bottom line yields, the potential for improving yields through death benefit optimization is often overlooked.  
 

Considerations for Separate Account BOLI Owners

Banks have been using separate account BOLI as informal offset to employee benefits costs since the late 1990s. During the early 2000s, the separate account structure became the product of choice for many mid- and large-sized banks. The structure requires an allocation of premiums to one or more investment sub-accounts offered by the insurance carrier.

Factors to Consider Before Executing a 1035 Exchange of BOLI Policies

Over the past two decades, Bank Owned Life Insurance (BOLI) has shown to be a great asset for banks, but occasionally a policy group may need to be replaced with a new product.  A replacement is typically executed via tax-free exchange under Internal Revenue Code Section 1035 (“1035 Exchange”). A 1035 Exchange should not be taken lightly, and there are many factors to consider before executing an exchange.

Potential Benefits of Consolidating BOLI Administration with
Newport Group

Bank-owned life insurance (BOLI) has been widely accepted by banks of all sizes for well over two decades, and the number of BOLI policies on bank balance sheets has increased steadily during that time. As of September 30, 2018, approximately 3,500 U.S. banks reported owning BOLI, which in aggregate totals over $190 billion of cash value.

The Purchase of BOLI Post Tax-Reform

For many decades, banks of all sizes have used bank-owned life insurance (BOLI) as an effecient tool for offsetting employee benefit cost. Today, over $189 billion of BOLI resides on U.S. bank balance sheets.1

Potential Tax Reform Implications for COLI and BOLI

Implications of the 2016 election relative to the taxation of life insurance, particularly the taxation of bank-owned life insurance (BOLI) and corporate owned life insurance (COLI).

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