With an EBP, the company uses compensation bonuses to assist the executives in savings for their own personal financial and retirement goals. The company pays the premiums on a specially designed, executive-owned life insurance policy and treats the premium amount as a compensation bonus to the executive. The premium amount is tax deductible to the corporation and taxable income to the executive. If properly structured, the tax-advantaged cash value accumulation within the policy and the death benefits can provide the employee with additional retirement income and survivor benefits.