Bank-Owned Life Insurance (BOLI)

Bank-owned life insurance (BOLI) is a type of life insurance policy that is owned by a bank or other financial institution. The bank uses the policy to generate income by investing the premiums and using the death benefit to pay off the loan. BOLI can be a good option for businesses that need life insurance coverage but don't want to take on the administrative burden of owning and managing a policy themselves.

There are a few things to keep in mind when considering BOLI. First, the bank will charge a fee for owning the policy, which will reduce the amount of money that is available to your beneficiaries. Second, the bank may have restrictions on how the policy can be used. For example, the bank may not allow you to borrow against the policy or use it to fund a retirement plan.

If you're considering BOLI, it's important to talk to your financial advisor to make sure that it's the right option for you.

Here are some additional details about BOLI:

* BOLI is a type of permanent life insurance policy. This means that the policy will remain in force for your entire life, as long as you continue to pay the premiums.
* The death benefit of a BOLI policy is typically equal to the amount of the loan that is secured by the policy. However, some policies may offer a higher death benefit.
* The interest rate on the loan that is secured by the BOLI policy is typically fixed. This means that the interest rate will not change over time.
* The bank will charge a fee for owning the BOLI policy. This fee is typically based on a percentage of the policy's face value.
* The bank may have restrictions on how the policy can be used. For example, the bank may not allow you to borrow against the policy or use it to fund a retirement plan.

If you're considering BOLI, it's important to talk to your financial advisor to make sure that it's the right option for you.