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thank you, come again!
Froogle 1.1.1.7
Froogled By:
Elias Makere, FSA, MAAA
Last Froogled:

BUSINESS-OWNED LIFE INSURANCE (BOLI)

life insurance that is owned/purchased by a business. The named-insured is [often] one of the business’ [own] employees (eg, a vice president of operations). The [purported] purpose [of the policy] is to protect/indemnify the business from the losses that it could incur from that employee’s death.

EXAMPLE:

a professional basketball team drafts John – the best player in college. John’s exciting style of play will generate twenty million dollars per year – for the team. As such, the team has an insurable interest in John, and it buys a life insurance policy (to protect their investment). If John dies then the policy will pay the team one-hundred million dollars.


see moral hazard; foreseeability; insurable interest
Congratulations! You're now Froogled Up™ on what "BOLI" means!

Feel free to use it throughout your financial/insurance life.

Sincerely,



www.FroogleMe.com
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