Split Funded Defined Benefit Plans Using Life Insurance

This course will discuss the use of life insurance inside a defined benefit qualified retirement plan (i.e. a split-funded defined benefit plan). The discussion will initially focus on the qualified plan options for a typical 50 something business owner who has not yet planned for retirement. Defined benefits plans will be introduced as a plan that may meet the retirement needs of such an individual. The bulk of the presentation will focus on the use of life insurance in a split-funded defined benefit plan. Life insurance will be first introduced in the context of providing an additional survivor benefit under the plan. The presentation will go on to discuss several issues revolving around life insurance inside the plan including: the incidental benefits test, the taxation of life insurance while inside the plan, the options available at retirement, and the tax implications at death. Additionally, issue to be avoided with life insurance, such as excessive funding and discrimination will also be discussed.