Executive Bonus Life Insurance Plan. Under the executive bonus plan, the employer pays a bonus to the employee so the employee can purchase (and own) a fixed indexed universal life (fiul) insurance policy. This is actually a salary reduction (defined contribution) formulated plan.
The employer pays for a benefit that is owned by the executive. A 162 executive bonus plan allows a business to provide life and/or disability income insurance to key executives using tax deductible dollars. One program worth looking at is an executive bonus plan (sometimes called a section 162 plan).