A life insurance policy that is taken out on employees for the benefit of the corporation. The company pays the premiums. Tax breaks can be earned for five years on the cost of the premium. COLI differs from group life insurance, which is provided to employees as a benefit and is payable to a beneficiary that the insured employee chooses. COLI has come under fire for the large tax breaks it generates and for the fact that it pays the company when an insured person dies even after the person has left the company or has retired.