For the most part, life insurance premiums increase as you get older.
In addition to being illegal, backdating isn't always a sure thing.
To prevent this change in premium, a policy may be backdated to save the previous age of the applicant.
Here’s how it works: Final Premium = 0 annually This policy was backdated with a policy date of July 15, which is one day before the applicant’s age change.
He pays the per share exercise price and can turn around and sell those shares on the exchange for each, netting a profit of per share, or ,000.
Why It Matters Granting stock options to employees is a generally accepted and perfectly legal form of compensating employees. Critics of backdating argue that the practice is difficult to detect and thus encourages boards and executives to use it to synthesize more creative compensation packages.