Can Nevada employers self-fund life insurance benefits for employees?

Most small and mid-sized Nevada employers do not self-fund life insurance benefits — instead using fully insured group products from A-rated (A.M. Best) carriers. True self-funding of life insurance is uncommon and carries significant financial risk.

With fully insured group life: the employer pays premiums to an insurance carrier. The carrier assumes all mortality risk and pays claims from its own funds. This is the standard approach for Nevada businesses of all sizes.

Group captive arrangements: some larger employers participate in group captive insurance arrangements where multiple employers pool resources to fund benefits collectively. This is more common for health and property/casualty coverage than for life insurance.

Voluntary supplemental (employee-paid): employers can offer supplemental life insurance where employees pay 100% of the premium through payroll deduction. The employer's financial risk is minimal — the carrier bears the mortality risk while the employer administers the payroll deduction.

Carving out executives: some Nevada employers offer a standard group plan for all employees while providing supplemental individual policies for executives through executive benefit arrangements (executive bonus plans, split dollar). This ensures competitive executive benefits while limiting the employer's ongoing group life cost.

For most Nevada businesses, the fully insured group life model is the most practical and financially straightforward approach. Agents in our network can help Nevada employers evaluate group life options from A-rated (A.M. Best) carriers.