Bank Owned Life Insurance: A Critical Examination of Banking Strategy
This paper is an investigation of a rampant insurance practice in the US banking sector, namely the permitted practice of employer-paid insurance policy. Under this policy, employee’s life policy paid for by the employer, pays large sums as policy benefits to the employer not to the employee’s famil...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
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Universiti Utara Malaysia
2012
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| Online Access: | https://repo.uum.edu.my/id/eprint/25013/1/IJBF%209%201%202012%2015%2026.pdf |
| _version_ | 1825805205653946368 |
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| author | You, Leyuan Dandapani, Krishnan |
| author_facet | You, Leyuan Dandapani, Krishnan |
| author_sort | You, Leyuan |
| collection | UUM |
| description | This paper is an investigation of a rampant insurance practice in the US banking sector, namely the permitted practice of employer-paid insurance policy. Under this policy, employee’s life policy paid for by the employer, pays large sums as policy benefits to the employer not to the employee’s family. Employers suggest that taking insurance covers the possible monetary loss value of an employee departing the firm, and hence the benefit is quite permissible, kosher. Our findings show its widespread occurrence in beefing up the earnings and even the capital base of the US banks. It calls into question if this practice, though legal, is socially responsible since an employee with such employer-paid policy would be deprived of tax deduction for his own self-paid policy cover, in most instances. Banking sector’s prevalent use of this practice to cover even low-paid workers such as janitors brings into focus the ethics of this practice. |
| first_indexed | 2024-07-04T06:28:30Z |
| format | Article |
| id | uum-25013 |
| institution | Universiti Utara Malaysia |
| language | English |
| last_indexed | 2024-07-04T06:28:30Z |
| publishDate | 2012 |
| publisher | Universiti Utara Malaysia |
| record_format | eprints |
| spelling | uum-250132018-10-25T00:29:16Z https://repo.uum.edu.my/id/eprint/25013/ Bank Owned Life Insurance: A Critical Examination of Banking Strategy You, Leyuan Dandapani, Krishnan HG Finance This paper is an investigation of a rampant insurance practice in the US banking sector, namely the permitted practice of employer-paid insurance policy. Under this policy, employee’s life policy paid for by the employer, pays large sums as policy benefits to the employer not to the employee’s family. Employers suggest that taking insurance covers the possible monetary loss value of an employee departing the firm, and hence the benefit is quite permissible, kosher. Our findings show its widespread occurrence in beefing up the earnings and even the capital base of the US banks. It calls into question if this practice, though legal, is socially responsible since an employee with such employer-paid policy would be deprived of tax deduction for his own self-paid policy cover, in most instances. Banking sector’s prevalent use of this practice to cover even low-paid workers such as janitors brings into focus the ethics of this practice. Universiti Utara Malaysia 2012 Article PeerReviewed application/pdf en https://repo.uum.edu.my/id/eprint/25013/1/IJBF%209%201%202012%2015%2026.pdf You, Leyuan and Dandapani, Krishnan (2012) Bank Owned Life Insurance: A Critical Examination of Banking Strategy. The International Journal of Banking and Finance, 9 (3). pp. 15-26. ISSN 1617-722 http://ijbf.uum.edu.my/index.php/previous-issues/147-the-international-journal-of-banking-and-finance-ijbf-vol-9-no-3-september-2012 |
| spellingShingle | HG Finance You, Leyuan Dandapani, Krishnan Bank Owned Life Insurance: A Critical Examination of Banking Strategy |
| title | Bank Owned Life Insurance: A Critical Examination of Banking Strategy |
| title_full | Bank Owned Life Insurance: A Critical Examination of Banking Strategy |
| title_fullStr | Bank Owned Life Insurance: A Critical Examination of Banking Strategy |
| title_full_unstemmed | Bank Owned Life Insurance: A Critical Examination of Banking Strategy |
| title_short | Bank Owned Life Insurance: A Critical Examination of Banking Strategy |
| title_sort | bank owned life insurance a critical examination of banking strategy |
| topic | HG Finance |
| url | https://repo.uum.edu.my/id/eprint/25013/1/IJBF%209%201%202012%2015%2026.pdf |
| work_keys_str_mv | AT youleyuan bankownedlifeinsuranceacriticalexaminationofbankingstrategy AT dandapanikrishnan bankownedlifeinsuranceacriticalexaminationofbankingstrategy |