Split Dollar Alternative
Although the endorsement of the Split Dollar Life Insurance technique is perhaps one of 
the most complicated choices in a Section 162 Executive Bonus Plan it should not be ruled out in every situation in favor of Section 162 Bonus, Death Benefit, or Group Term Life Insurance programs.
The “split” in Split Dollar means the company and executive share the cost of the Split Dollar life insurance as well as the other benefits of a cash value life insurance policy. The company pays the life insurance premiums into a company owned life insurance policy. The insurance policy's death benefit is provided to the employee’s beneficiary through an agreement that endorses a portion of the life insurance benefit to the beneficiaries as designated by the executive. This split dollar agreement can be maintained after retirement for the life of the insured executive that had a Section 162 Executive Bonus Plan.