What Is Split Life Insurance? 
In Canada , Split Dollar Insurance is usually referred to as Shared Interest Insurance . The Shared Interest concept is an effective strategy for sharing life insurance costs and benefits.There are a number of family and business scenarios where this concept can be applied . To illustrate , I will outline a business situation as an example . Under the shared interest concept , the death benefit , premiums and cash values of a permanent insurance policy are apportioned between company and the key employee or shareholder , who pay for their separate interests under the policy . With the Company responsible for the life insurance portion of the premium , it receives : - Tax free buffer fund to cushion the shock of death of key person -LRB- protect profits -RRB- - Funds to redeem shares for a buy-sell & / or succession plan - Life insurance death benefit creates a tax free capital dividend that can be paid out to surviving shareholders . With the business owner or key person responsible for the cash value portion of premium , he/she receives : - Tax advantaged accumulation without paying mortality costs - Access to cash value for living benefits -LRB- policy loans , withdrawals , collateral -RRB- - Increased retirement resources . Setting up the Shared Interest concept is complex . There are many issues to consider in addition to what is outlined here . Therefore , it is recommended you seek your own independent professional advice from your lawyer and/or accountant . Note : The Canada Revenue Agency 's -LRB- CRA -RRB- position is that each party in the shared interest agreement must pay a reasonable amount of the premium for the benefit the party receives . In a non-arm 's length situation , a taxable benefit may be considered to be conferred on one of the parties to the agreement unless all parties pay a cost equal to the fair market value of the benefit received . If you have further questions , or feel that I could be of assistance , please do not hesitate to contact me . If you would like to work with a local life insurance broker , you could start with a Google search . For example , if you search for : life insurance broker Halifax or life insurance agent Halifax , my name , along with several others , will come up . You can use the same method to find a life insurance broker in your community . 