Executive Group Life Insurance
Executive Group Life (EGL) is group life insurance coverage designed to help executives and other senior professionals by providing a generally income-tax-free death benefit for their beneficiaries, as well as the opportunity to accumulate account value to meet future needs. Executive Group Life insurance enables most employers to enhance their executive benefits while still minimizing overall benefit costs.
As the employer, you can use Executive Group Life insurance to gain a competitive edge through the benefits provided to your executives and senior professionals. With generally higher death benefits than group life insurance, Executive Group Life insurance can protect an employee’s family while providing the ability to make additional premium payments (subject to certain limits) to potentially accumulate account value. Participants can access account values through loans and withdrawals to help fund future needs such as college tuition or supplementing retirement income1.
The Executive Group Life insurance program helps employers:
- Deliver enhanced benefits to executives and senior professionals while simultaneously helping to control overall benefit costs;
- Flexibly establish life insurance benefit amounts for their executives and senior professionals;
- Recruit new talent and retain employees by providing valuable, life insurance coverage to a firm's executive benefit suite.
The Executive Group Life insurance also provides employees with:
- Higher death benefit amounts for executives and senior professionals that usually exceed those available through the group term life insurance plans offered by many employers;
- Tax-deferred account value accumulation potential;
- Long-term, portable coverage for executives after they leave the firm; 2,3
- The flexibility to borrow or withdraw accumulated account values from their certificate, providing them with an accessible source of funds to help meet their future needs.1
1 Withdrawals and decreases in Face Amount may have tax consequences. The insured should consult their tax advisor. Certificate withdrawals are not subject to taxation up to the amount paid into the certificate (cost basis). If the certificate is a Modified Endowment Contract, certificate loans and/or withdrawals will be taxable to the extent of gain and are subject to a 10% tax penalty. Access to account values through borrowing and/or withdrawals will reduce the cash surrender value and may reduce the certificate death benefit. Taking a certificate loan could have adverse tax consequences if the policy terminates upon lapse or surrender or before the insured’s death.
2 Costs for portable certificates may be higher than those for active employees.
3 Coverage under some policies is portable provided the group policy is inforce when the employee leaves the employer.
The information provided is not written or intended as specific tax or legal advice. MassMutual, its subsidiaries, employees and representatives are not authorized to give tax or legal advice. Individuals are encouraged to seek advice from their own tax or legal counsel.