Presently, there are several companies looking to issue Stable Value Protection (SVP) for BOLI, and there appears to be significant interest by banks to evaluate and implement these solutions. We delve into some of the key accounting considerations of which BOLI owners should be mindful when evaluating these products.
Buyers must beware! SVP providers generally offer no assurances as to the accounting treatment of the SVP features they offer. As described in the paper, the implications of misunderstanding and mischaracterizing the GAAP treatment of an SVP feature could be severe.