MKA Executive Planners Blog

You run a business or a professional practice. It is successful. You have a group of employees, along with yourself, who are key to business success. It is a great team. Margins are okay, but not great, and you or one of your key people becomes disabled and won’t return to work for a significant period of time – or ever.

When Richard E. Wiley passed away recently, he left a huge legacy at Endicott College. As its long time President, he grew the school from what was once a small regional two-year associates degree player to a nationally known multifaceted institution offering bachelors, masters and doctoral degrees. There are three campuses and a large range of options for study. It has an endowment in excess of $60 million, a 50% increase within the last five years.

It’s the worst!  Your project has developed to the point where you’re about to build the working model and file the application for a patent or FDA approval. The scientist who is heading the project walks into your office and tells you she or he is leaving for another position at the company a half mile down the road.  He or she has led a small team and doesn’t have a back-up. 

Everyone relaxed when the House and Senate decided not to block deferred compensation plans as we know and love them.

Your career has brought you to the top because of the great experience of working for several major companies, both in and out of your current company’s industry. You’re in the C-Suite and playing an important role in management and moving your company forward. You have a great salary and a wonderful work environment.

According to news reports, New York Giants star receiver Odell Beckham, Jr., is thinking about purchasing a $100 million (yup, $100,000,000) policy to protect the value of his earning potential in the event he is injured and cannot earn pay at his current ability level.  The importance of this was brought home when he sprained an ankle at a recent pre-season game.

MKA offers concierge underwriting for its high net worth investors, business owners and highly-compensated professional and executive clients.  Concierge underwriting is hands on and handled on a secure and personalized basis by us and our associates.  Here is a recent example.

“What?”, you say.  Yes, there are many significant risks out there, and you buy commercial insurance to absorb them.  Autos, homes and other property are insured.  You have liability insurance.  You have medical insurance.  You have dental insurance – and maybe life insurance.  But, actually, you hold all those risks.  You have chosen to “reinsure” them in full or in part with a business that specializes in covering unaffordable risk.  You get to pick the maximum amounts payable and deductibles, absorbing the affordable exposures that you did not cover.

After tax supplemental compensation plans funded with life insurance offer a hybrid arrangement that reduces the complexity and expense associated with non-qualified deferred compensation plan. These plans are a great benefit for a company to offer to non-owner key executives to retain and reward them for their valuable services. They are especially attractive in pass through entities such as Subchapter S corporations and tax exempt organizations.

Executives generally are not aware that they have shortfalls and gaps in their broad based group long term disability coverage.  This applies to both the size of the monthly benefit and the language in the contract that the insurer uses to accept or deny claims.