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                                                                   EXHIBIT 10.15

 
                         PENNCORP FINANCIAL GROUP, INC.
 
               1996 SENIOR EXECUTIVE ANNUAL INCENTIVE AWARD PLAN
 
I. PLAN OBJECTIVES
 
     The objectives of the 1996 Executive Annual Incentive Award Plan (the
"Plan") are to advance the interests of PennCorp Financial Group, Inc. (the
"Company") and its shareholders by providing key executives with incentive
opportunities that:
 
     - provide compensation opportunities which are competitive with those of
      comparable institutions
 
     - focus these executives' attention on the accomplishment of specifically
      identified Company goals
 
     - recognize different levels and types of individual contributions by
      providing for adjustment of the incentive payout on the basis of
      individual performance
 
II. DEFINITIONS
 
     "Annual Incentive Award" or "Award" means the compensation payable under
the Plan to a Participant by the Committee pursuant to such terms, conditions,
restrictions and limitations established by the Committee and the Plan.
 
     "Board" means the Board of Directors of the Company.
 
     "Code" means the Internal Revenue Code of 1986, as amended from time to
time.
 
     "Committee" means the Compensation Committee of the Board, or such other
committee designated by the Board to administer the Plan, provided that the
Committee shall consist of three or more persons each of whom is an "outside
director" within the meaning of Section 162(m) and a "disinterested person"
within the meaning of Rule 16b-3 under the Exchange Act.
 
     "Exchange Act" means the Securities Exchange Act of 1934, as amended.
 
     "Plan" means the PennCorp Financial Group, Inc. 1996 Senior Executive
Annual Incentive Award Plan.
 
     "Performance Goals" shall be defined as the performance criterion or
criteria established by the Committee, pursuant to Section V hereof, for the
purpose of determining Awards under the Plan.
 
     "Performance Period" means the consecutive 12 month period that constitutes
the Company's fiscal year, unless otherwise specified by the Committee.
 
     "Section 162(m)" means Section 162(m) of the Code and the regulations
promulgated thereunder.
 
III. ADMINISTRATION OF THE PLAN
 
     The plan will be administered by the Committee. The Committee is authorized
to interpret the Plan and to establish and amend rules and regulations necessary
for Plan administration. Decisions of the Committee shall be binding on all
persons claiming rights under the Plan.
 
IV. ELIGIBILITY
 
     Participants will be selected by the Committee annually not later than 90
days after the approval of the Plan at the 1996 Annual Meeting of Stockholders
and thereafter not later than 90 days after the commencement of Performance
Periods commencing on and after January 1, 1997. The Chief Executive Officer and
the President of the Company are hereby designated as the initial Participants
under the Plan.
 
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     Notwithstanding the foregoing, at any time during a Performance Period the
Committee may designate new Participants or remove Participants, in its sole
discretion. Participation in the Plan in any prior year or years shall not give
one the right to be a Participant in any subsequent year.
 
V. PERFORMANCE GOALS AND MEASURES
 
     Performance Goals shall be established by the Committee not later than 90
days after commencement of the Performance Period relating to a specific Award
(or, in the case of the Performance Period covering the 1996 fiscal year, not
later than June 11, 1996, the date of the Proxy Statement relating to the 1996
annual meeting of shareholders). The Performance Goals may be identical for all
Participants or, at the discretion of the Committee, may be different to reflect
more appropriate measures of performance. The criterion or criteria used in
establishing Performance Goals may, at the discretion of the Committee, include
a targeted growth rate in annual compounded earnings per share or any other
appropriate measure such as revenue, cash flow, EBITDA, net income, return on
assets or return on equity. The Performance Goals established by the Committee
shall include a threshold level below which no Award will be payable and a
maximum Award level for each Participant. The determination of attainment of the
Performance Goals shall be determined in accordance with generally accepted
accounting principles and certified in writing by the Committee.
 
     The Committee shall be authorized to make adjustments in the method of
calculating attainment of Performance Goals in recognition of: (i) extraordinary
or non-recurring items, (ii) changes in tax laws, (iii) changes in generally
accepted accounting principles or changes in accounting policies, (iv) charges
related to restructured or discontinued operations, (v) dispositions or
acquisitions of businesses or business units, (vi) restatement of prior period
financial results, and (vii) any other unusual, non-recurring gain or loss that
is separately identified and quantified in the Company's financial statements.
Notwithstanding the foregoing, the Committee may, at its sole discretion, (x)
reduce the Awards under the Plan to offset any results not anticipated when the
Performance Goals were established or (y) increase or reduce the Awards under
the Plan, but in neither event by more than 25%, to reflect the Committee's
evaluation of the individual performance of any Participant under the Plan;
provided that no such adjustment shall be made if such adjustment would affect
the tax deductibility of the Award under Section 162(m) of the Code.
 
VI. AWARDS
 
     Awards under the Plan shall be paid in cash as soon as practicable
following the close of that Performance Period.
 
     At the first meeting of the Committee after the expiration of the
Performance Period, the Committee shall review the prior year's performance in
relation to the Performance Goals and determine the level of achievement of the
Performance Goals. Payment of Annual Incentive Awards to Participants under the
Plan shall occur only after the Committee has certified in writing that the
Performance Goals have been achieved for the relevant Performance Period. The
maximum Annual Incentive Award that may be granted to a Participant under the
Plan for any Performance Period shall be twice the Participant's target bonus
opportunity.
 
VII. AMENDMENT, MODIFICATION, SUSPENSION OR TERMINATION OF THE PLAN
 
     The Board may amend, modify, suspend or terminate this Plan for any purpose
except that no amendment or alteration shall be effective prior to approval by
the Company's shareholders to the extent such approval is then required pursuant
to Section 162(m) or otherwise required as a matter of law. Further, no
amendment to the Plan shall be effective that would (i) increase the maximum
amount that can be paid to a Participant under the Plan in a Performance Period;
(ii) change the performance criterion or criteria set forth in Section V hereof
for payment of Awards; or (iii) modify the eligibility requirement for
Participants in the Plan unless first approved by the Company's shareholders.
 
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VIII. EFFECTIVE DATE OF THE PLAN
 
     This Plan shall be effective as of January 1, 1996. Notwithstanding the
foregoing, the adoption of this Plan is expressly conditioned upon the approval
by the Company's shareholders at the annual meeting of the Company's
shareholders held in 1996. If the shareholders of the Company shall fail to
approve this Plan, this Plan shall terminate and cease to be of any further
force or effect. Subject to earlier termination pursuant to Section VII, the
Plan shall remain in effect through the conclusion of the 2001 fiscal year of
the Company. After termination of the Plan, no future Awards may be granted.
 
IX. INTERPRETATION
 
     The Plan is designed to comply with Section 162(m) of the Code, and all
provisions hereof shall be construed in manner consistent with that intent.
 
X. GOVERNING LAW
 
     The Plan and all determinations made and actions taken pursuant thereto
shall be governed by the laws of the State of New York and applicable federal
law and construed in accordance therewith.
 
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