Capaxa Coli Pool

What is Capaxa COLI Pool? Capaxa COLI Pool is a specialized investment vehicle that allows businesses to pool their Corporate Owned Life Insurance (COLI) policies into a collective fund managed by Capaxa Financial. This pooled structure enables companies to leverage economies of scale, enhance investment performance, and streamline administrative processes associated with COLI ownership.

Key Features of Capaxa COLI Pool:

  • Diversification: By pooling COLI policies, Capaxa COLI Pool offers enhanced diversification across a broader range of investment options, including fixed income securities, equities, and alternative assets.

  • Professional Management: Capaxa Financial provides professional investment management services for the pooled assets, leveraging their expertise to optimize investment returns and mitigate risk.

  • Customization: Capaxa COLI Pool offers flexibility and customization options to meet the unique needs and objectives of participating companies, allowing for tailored investment strategies and benefit structures.

  • Cost Efficiency: Pooling COLI policies with Capaxa COLI Pool can result in cost savings through economies of scale, reducing administrative expenses and investment management fees for participating companies.

Benefits of Capaxa COLI Pool:

  • Enhanced Investment Performance: The pooled structure of Capaxa COLI Pool can lead to improved investment performance compared to individual COLI policies, thanks to the benefits of diversification and professional management.

  • Streamlined Administration: Participating companies benefit from simplified administrative processes, as Capaxa Financial handles investment management, reporting, and compliance responsibilities on behalf of the pool.

  • Risk Mitigation: Capaxa COLI Pool offers risk mitigation benefits through diversification and professional management, helping to protect against market volatility and optimize long-term investment outcomes.

  • Tax Efficiency: Capaxa COLI Pool may provide tax advantages for participating companies, including potential tax-deferred growth and tax-efficient distribution strategies.

Applications of Capaxa COLI Pool:

  • Corporate Risk Management: Capaxa COLI Pool can serve as a strategic tool for corporate risk management, providing financial protection against the loss of key employees while optimizing investment returns on COLI assets.

  • Employee Benefits Enhancement: Participating companies can use Capaxa COLI Pool to enhance employee benefits programs, such as funding retirement plans, executive compensation arrangements, and employee retention strategies.

  • Capital Optimization: Capaxa COLI Pool enables companies to optimize their capital by reallocating resources from individual COLI policies to a professionally managed investment pool, maximizing returns and efficiency.

Capaxa COLI Pool offers businesses a sophisticated and efficient solution for managing Corporate Owned Life Insurance (COLI) assets, optimizing investment performance, and enhancing corporate benefits programs. With its diverse range of features, benefits, and strategic applications, Capaxa COLI Pool provides a powerful tool for companies seeking to strengthen their financial position and achieve their long-term objectives.

Trust Pooled Life Insurance

Many Credit Union assets, including mortgages, auto loans, and credit card receivables, can be pooled

into a trust to diversify the risks and volatility associated with repayment. Similar to participation pools that

guarantee returns (Fannie Mae, Freddie Mac, Ginnie Mae, Sally Mae), the CU can use the same strategy

with CASD loan receivable assets, CUOLI assets, and SPDA assets. In this example:

Investment Pooling Options

The CU can elect to purchase Pool interests with direct Cash investment. If the investment or insurance

deposited is not tied to a CASD plan (as “Benefits Pre-Funding” only) the credit union can realize the

entire increase in cash value generated by the pool’s capitalization of the death benefit.

For a 15-year held-to-maturity participation certificate:

  • Floating Rate: SOFR301 + 360 bps adjusted monthly on the final business day of the month

    • 8.92% APY as of April 1st

    • Additional “Securitized Spread” – the proceeds from death claims above the guaranteed values and after fund fees, returned to Participation Certificate Holders proportional to holdings.

  • Target Yield to Maturity: >6%

  • Minimum Yield to Maturity: 3.60% (if SOFR30 = 0%)

  • Fully collateralized by carrier guaranteed cash values

In addition to the purchase of Pool interests with direct Cash investment, the CU can elect to add any

other in-force life insurance to the LifeNotes Fund I pool. The CU can elect at anytime in the future to re-

allocate among certificate classes to optimize duration, return, and collateral class.

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