1. Exceptional Employees – Hard to Find and Harder to Keep
insurance arrangement
Self Owned Life And Retirement (S.O.L.A.R.) Insurance Arrangements
These materials are not intended to and cannot be used to avoid tax penalties and they were prepared to support the
promotion or marketing of the matters addressed in this document. Each taxpayer should seek advice from an independent tax
advisor. The ING Life Companies and their agents and representatives do not give tax, legal nor lending advice.
LIFE INSURANCE
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2. Talented employees are the lifeblood of your business. Without them, you
face an even tougher battle in today’s competitive business world. In the past, employers
attracted, motivated, and retained their more talented employees by offering a combination
of salary, incentive bonus, and qualified retirement benefits. Unfortunately, these traditional
compensation strategies fail to address several important issues:
k The cost of replacing key employees is getting higher.
"Keep Your SuperStars, Save Millions of Dollars," American Gas Magazine, March, 2008
k ERISA makes it difficult to single out and reward highly-
compensated employees using qualified retirement plans.
David Miller, "Secrets to Protecting Your Organization and Retaining Key
Employees," REESOURCE SENIOR LIVING, November 2010
k Salary increases and bonuses have short-lived impact on long-term
job satisfaction and loyalty to the business.
Abhishek Kamdi, "Workplace Environment and its Impact on Employee
Performance," Human Resource Management Blog, November 22, 2009
k Salary and bonuses force employees to pay taxes on income now
even though the funds may not be needed until later. IRC § 61
A Self Owned Life And Retirement (S.O.L.A.R.) Insurance Arrangement is a simple tool
employers can use to reward their most valued employees. The S.O.L.A.R. Insurance
Arrangement can be offered selectively as a benefit to encourage the retention of
employees the business can’t afford to lose.
In a S.O.L.A.R. Insurance Arrangement, an employee purchases an ING Indexed
Universal Life - Global Plus (ING IUL-Global Plus) life insurance policy, issued by Security
Life of Denver Insurance Company, to provide death benefit protection and to help
accumulate funds for retirement. The arrangement can be funded through employer
contributions, through after-tax contributions from the employee, or a combination of
both. While premium payments must be treated as ordinary income, the employee can
borrow money from the ING IUL-Global Plus life insurance policy to pay income taxes.
The employee can use the policy as a source of potential supplemental retirement
income, as a source of survivorship benefits, or both.

3. Potential Advantages for the Employee
k Additional contributions – The employee can contribute additional dollars to
Exceptional Employees – Hard to Find and Harder to Keep
the arrangement.
k Supplemental Retirement Income1 – Bonuses are used to purchase a life
insurance policy which may help to accumulate cash value.
k Reduce “Out-of-Pocket” Costs1 – By taking a policy loan to pay income taxes,
the S.O.L.A.R. Insurance Arrangement can reduce the current costs to the executive.
k Tax-Deferred Growth – No income tax is payable on any money
accumulating inside the life insurance policy.
k Tax-Free Income1 – Provided the life insurance policy is not structured as a
modified endowment contract (“MEC”), the executive will be able to attain
tax-free income through a combination of policy withdrawals and loans.
k Income Tax-Free Death Benefit2 - The life insurance policy provides
protection for the executive’s family in the event of death.
k No IRS Distribution Requirements.
Potential Advantages for the Employer
k Immediate Tax Deduction – Payments made by the employer are treated as
bonuses and are income tax deductible under IRC § 162 (so long as the
executive’s total compensation is considered reasonable).
k Flexible Contributions – There is no required schedule for premium
contributions to a S.O.L.A.R. Insurance Arrangement. Premiums can be
designed to meet the changing needs of the employer.
k Selective Benefit – A S.O.L.A.R. Insurance Arrangement can be offered on a
selective basis. Unlike qualified retirement plans, there is no requirement that
the benefit be available on a nondiscriminatory basis.
k Additional Incentives – The employer could choose to pay the policy loan
interest if the employee has chosen to pay the income taxes from policy values.
k Golden Handcuffs – The employer can create “Golden Handcuffs” by
implementing a Restricted S.O.L.A.R. Insurance Arrangement.
k Simple Administration – Some nonqualified benefits (such as NQDC/SERP
arrangements) can require significant plan administration (maybe even
requiring a third-party administrator). A S.O.L.A.R. Insurance Arrangement is a
potentially simple arrangement requiring little or no plan administration.
1 A portion of the policy’s surrender value may be available as a source of supplemental retirement income through policy loans and
withdrawals. Income tax free policy distributions may be achieved by policy loans or withdrawing to the cost basis (usually
premiums paid). This assumes the policy qualifies as life insurance, is not a modified endowment contract and is not lapsed or
surrendered with an outstanding loan. Policy loans and withdrawals may reduce or eliminate index credits, generate an income tax
liability, reduce available surrender value and reduce the death benefit, or cause the policy to lapse. Additionally, loans may limit
your ability to make elections to the Indexed Strategy; if a loan results in amounts being deducted from a block prior to its block
maturity date, no elections from the Fixed Strategy to the Indexed Strategy will be processed in the 36 months following the loan.
Select Loans have the risk that policy performance may be lower than projected if the amount credited to the account value in the
Fixed Strategy and/or Indexed Strategy is less than the fixed 6% interest charged on the policy loan.
2
Death benefit proceeds from a life insurance policy are generally income tax-free, and if properly structured, may also be free
from estate tax.

4. How a S.O.L.A.R. Insurance Arrangement Works
The company and the
1
employee agree that personal
# life insurance protection and
the related potential cash value
accumulations are important
components of the employee’s
overall compensation package.
#
2
The employee purchases an
ING IUL-Global Plus policy
insuring his or her life.
3
The company makes the
# premium payments on this
policy, which are taxed as
additional compensation to the
employee and create a current
deduction for the employer.
Optionally, the company may
provide an additional cash
bonus to the employee to cover
the income tax associated with
the premium payment.
4
The employee may pay the
# income taxes on the bonused
premium payments using policy
loans from the ING IUL-Global
Plus policy values.3
#
5 The policy cash values may be available to
supplement the employee’s retirement income
through withdrawals and loans. Policy loans
and withdrawals may reduce or eliminate index
credits, generate an income tax liability, reduce
available cash value, and reduce the death
benefit or cause the policy to lapse. The policy
death benefit generally will be paid income tax
free to the employee’s beneficiaries.
3 Select Loans have the risk that policy performance may be lower than projected if the amount credited to the account value in the Fixed
Strategy and/or Indexed Strategy is less than the fixed 6% interest charged on the policy loan.
The ING Life Companies and their agents and representatives do not give tax or legal advice. This information is general in nature and not comprehensive, the applicable laws change
frequently and the strategies suggested may not be suitable for everyone. You should seek advice from your tax and legal advisors regarding your individual situation.
ING Indexed Universal Life–Global Plus (ING IUL-Global Plus), policy form series 1182-12/10, with both a fixed and an equity indexed strategy, may vary by state and may not be
available in all states and is issued by Security Life of Denver Insurance Company (Denver, CO) a member of the ING family of companies.
All guarantees are based on the financial strength and claims paying ability of Security Life of Denver Insurance Company who is solely responsible for the obligation of its own policies.
Shelly Alvarez
© 2010 ING North America Insurance Corporation cn66420122012 President/General Agent
Shelly Alvarez Insurance & Financial Svcs. PLLC
(210) 827-8787
shelly@shellyalvarez.com
www.shellyalvarez.com HTTP://ING.US
158014 12/20/2010