HomeLatest NewsSDAHO EnterprisesThe History of Split Dollar Life Insurance

The History of Split Dollar Life Insurance

Split dollar insurance began in the mid-20th century. It provided a way for an employer and an employee to “split” the “dollars” provided by a cash value life insurance policy.

In its simplest form, the split involved only the death proceeds. Upon the employee’s death, the employer would receive death proceeds equal to the policy’s cash value, and the employee’s beneficiary would receive the balance. The employer retained all rights to the policy’s cash value.

Over the years, split dollar arrangements became more creative, and started directing a portion of the cash value to the employee. The employee’s portion of the cash value was intended to keep the insurance in force after termination of employment, or to provide supplemental compensation.

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About Modern Capital

SDAHO Enterprises’ Endorsed Business Partner Modern Capital Executive Solutions is a leading consulting firm in the non-profit and for-profit space, with a niche specialty in key personnel retention & reward programs, as well as investment & expense mitigation. With over 75 years of combined, they are better positioned than ever to deliver solutions consistent with the objectives of our clients.

The SDAHO Enterprises Endorsed Business Partner program was established to provide innovative and cost-effective solutions for our member hospitals and long-term care facilities across the healthcare continuum. The business partners selected are expected to meet high-quality standards and offer products or services which are designed to assist healthcare facilities avoid costs, recover revenue, reduce operating and capital expenses, improve management and quality, increase productivity, develop staff resources, and apply new innovative strategies.

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