by Chris Richardson, IZALE Financial Group
© 2016 IZALE Financial Group Studies have shown it can cost over 200% of an annual salary to replace a key executive unexpectedly, which could have a severe impact on your bottom line. This is why the topic of the cost of replacing key executives is important in any board room and a hot button for regulators. Life is about how we manage the unexpected.
In 2014, one of our clients experienced this first-hand. Their charismatic senior lender had been integral to the growth of their organization, helped them remain competitive in their market and drove the institution's loan portfolio. Unfortunately, he was in a tragic accident that ended his life far too soon. However, his organization had taken steps to protect themselves just in case the unexpected happened.
That organization had implemented a BOLI program that helped ease the financial strain on the institution while they shored up client relationships and hired a successor. Just as importantly, a benefit was provided to his surviving family that helped ease their pain. This client is extremely thankful they had the foresight to purchase BOLI.
Good things don't always happen, but that doesn't mean the outcome has to be bad. BOLI will not only give you competitive earnings but will also protect your institution from the financial expenses that come with replacing a key person while allowing for a meaningful benefit for those left behind.
In 2014, one of our clients experienced this first-hand. Their charismatic senior lender had been integral to the growth of their organization, helped them remain competitive in their market and drove the institution's loan portfolio. Unfortunately, he was in a tragic accident that ended his life far too soon. However, his organization had taken steps to protect themselves just in case the unexpected happened.
That organization had implemented a BOLI program that helped ease the financial strain on the institution while they shored up client relationships and hired a successor. Just as importantly, a benefit was provided to his surviving family that helped ease their pain. This client is extremely thankful they had the foresight to purchase BOLI.
Good things don't always happen, but that doesn't mean the outcome has to be bad. BOLI will not only give you competitive earnings but will also protect your institution from the financial expenses that come with replacing a key person while allowing for a meaningful benefit for those left behind.
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