Choosing an executive benefits provider for your credit union

May 20, 2015 by CU Management

Knowing your responsibility and the relevant regulations is key.

by: Fran Zaugg

The National Credit Union Administration identifies seven categories of risk to consider when running a credit union: credit, interest rate, liquidity, transaction, compliance, strategic, and reputation. Conduct thorough due diligence on prospective executive benefits providers with these risks in mind, advises John Pesh, director for executive benefits at CUES Supplier member and strategic provider CUNA Mutual Group, Madison, Wis.

“The provider should have a history with deferred compensation plans for non-profit entities,” stresses Pesh. “Working with for-profit Fortune 500 companies is very different” when you consider the regulations involved.

Pesh recommends asking prospective supplemental retirement plan providers for the following: referrals from credit unions similar to yours; audited financials; its succession plan (to help ensure support throughout the life of the plan); and how the firm will provide oversight of the program and underlying investments.

“Make sure they can walk you through how the plan works, and understand state and federal considerations. For instance, some states don’t allow you to make preferential loans to executives,” Pesh says.

In addition, adds Scott Albraccio, sales manager for executive benefits at CUNA Mutual Group, “choose a provider that offers a variety of options so you can meet your specific needs.”