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New Nonqualified Option for Growing Businesses

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Small and mid-sized businesses are growing steadily. According to The Principal Well-Being IndexSM: Business Owners, 88 percent of business owners rated the health of their business as either stable or growing. Now these businesses have another option to help compete for top talent in the marketplace thanks to the new Modified Cash Surrender Value rider from the Principal Financial Group(R). This new rider, available with Executive Variable Universal Life II (Executive VUL II), brings new choice and flexibility for employers looking to informally finance their nonqualified deferred compensation (NQDC) plans.

“Corporate-Owned Life insurance (COLI) product strength is usually reserved for larger employers, and we looked for a way to address the strong need among small and mid-sized businesses as well,” said Gary Dorton, Vice President – Nonqualified Solutions. “Adding this rider to our current product can bring stronger cash values plus extensive investment options to more small to mid-sized businesses than are available today.”

According to the Index, 57 percent of business owners say growing their business is a challenge. More than four in ten (43 percent) identify retaining talented employees as one of these challenges.

When Executive VUL II with the Modified Cash Surrender Value rider is used, it offers an array of benefits to small and mid-sized employers not typically found at these premium levels, such as:

  • Greater flexibility to finance NQDC plans efficiently
  • High early cash surrender value to build employer assets
  • Over 100 investment options to offer individualized investment choice
  • Complete policy and plan administrative services for both employers and their plan participants.

Employers may also receive tax benefits while the rider continues to help grow assets on their company balance sheet.

“Our nonqualified platform continually evolves to help meet the needs of employers of all sizes, allowing them to recruit, retain, reward and retire key employees in today’s competitive market,” adds Dorton.

About the Principal Financial Group

The Principal Financial Group(R) (The Principal(R))1 is a global investment management leader offering retirement services, insurance solutions and asset management. The Principal offers businesses, individuals and institutional clients a wide range of financial products and services, including retirement, asset management and insurance through its diverse family of financial services companies. Founded in 1879 and a member of the FORTUNE 500(R), the Principal Financial Group has $517.9 billion in assets under management2 and serves some 19.4 million customers worldwide from offices in Asia, Australia, Europe, Latin America and the United States. Principal Financial Group, Inc. is traded on the New York Stock Exchange under the ticker symbol PFG. For more information, visit

1 “The Principal Financial Group” and “The Principal” are registered service marks of Principal Financial Services, Inc., a member of the Principal Financial Group.

2 As of June 30, 2014.

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