Corporate-owned life insurance, often abbreviated COLI, is life insurance purchased and owned by a corporation on the lives of key employees, executives, or groups of workers, with the business typically named as beneficiary. COLI is used to informally fund nonqualified benefits, protect against key-person loss, or manage balance-sheet strategies using tax-deferred cash-value growth and generally income-tax-free death benefits when statutory requirements are met. Because COLI involves employer-owned policies, it is subject to strict notice, consent, and reporting rules under Section 101(j) and related guidance, as well as scrutiny from shareholders and regulators.

Advisors structuring corporate-owned life insurance work closely with corporate finance, legal, and HR teams to determine insured lives, coverage amounts, and product choices. They ensure written notice and consent are obtained from insured employees and that COLI programs align with benefit promises or funding goals. Advanced markets teams help design plan documents and coordinate tax reporting. Understanding corporate-owned life insurance allows advisors to deliver sophisticated institutional solutions while complying with employer-owned life rules and managing reputational considerations.