Long-term illness can represent a substantial financial strain for both employers and employees.
Group life, group critical illness and group income protection all provide a popular but affordable and tax-efficient financial safety net for employees and their families.
Life assurance
One of the most affordable and valuable employee benefits options, group life cover reassures your employees that should they die, their families and dependants will be cared for.
An unexpected death can have far-reaching consequences at a time of considerable stress, with families facing funeral and other expenses. In many cases, they are left having to pay off outstanding financial commitments or debts, and often have to contend with a sizeable drop in income.
Policies provide:
- A tax free lump sum to your employee’s family
- Flexibility in design to meet the needs of your workforce
- Financial security to provide peace of mind
Why it matters:
- Life insurance forms part of an attractive benefit package to attract and retain high calibre candidates
- As the risk is spread over a number of employees, premiums are usually cheaper than those paid for individual cover
- Advances in medical treatment and improved lifestyles mean that more people are living longer, reducing the rates for life cover in recent years
- A group life cover scheme requires very little administration and can be provided under a tax efficient wrapper for both you and your employee
- Claims can generally be paid within 48 hours using online capabilities
- Contracts also generally include bereavement counselling and probate helpline services to provide additional support
- Policies can now include a range of health and wellbeing services, such as remote GPs to both employees and their dependants
How we can help:
- World class consultative broking to leverage our scale to obtain the best outcome for you in terms of price and policy terms
- Actuarial modelling to derive an independent “WTW” risk rate/cost for your cover which can then be used to achieve the best market terms
- A governance and risk management audit to manage and mitigate any financial exposures between the insurance and benefit promise
- Trustee and Secretariat services to ease the burden and responsibilities around the nomination of beneficiaries, payment of claims and HMRC reporting requirements
Group income protection
Long-term illness can represent a substantial financial strain for both employers and employees. A group income protection policy will pay a proportion of an employee’s salary in the event that they are off work long term due to long-term illness or injury.
You can choose to either make these salary continuance payments directly to an individual or use the policy to fund payment for a limited period – or even provide your company with a lump sum to fund a leaving service benefit.
Policies provide:
- A continuation of salary to your employee, reducing your financial obligations
- A streamlined design to dovetail with your own sick pay policy
- A wealth of additional services, training, pathways and technology provided by the insurer to combat and manage absence in the workplace
Why it matters:
- Benefits can be designed to meet your business needs, both in terms of cost to you and value to your employees
- Robust claims assessment processes to ensure genuinely absent employees are cared for when they are unable to work
- Adjudication services to provide you with impartial guidance on suspicious absences
- An income protection policy will reduce the impact of ill health and early retirement on pension schemes. Policy payments can be either kept by the employer to offset the cost of an early pension or by the employee to fill the gap until the pension starts.
- Group policies will provide rehabilitation services to help nurse absent employees back to health (and the workplace) as soon as possible and can even prevent your staff from being absent in the first place
- By intervening early with an employee’s long-term sickness and offering advice on the reasonable adjustments needed for staff returning to work, a policy can help companies to demonstrate compliance with the Equality Act
- Broader clinical and educational services and communication material can be provided via a myriad of forums
How we can help:
- World class consultative broking to leverage our scale to obtain the best outcome for you in terms of price and policy terms
- Actuarial modelling to derive an independent “WTW” risk rate/cost for your cover which can then be used to achieve the best market terms
- A governance audit to devise a future proof and fit for purpose benefit design
- Absence management strategy that streamlines your existing benefit arrangements and processes to counter absenteeism in the workplace and improve the risk of your income protection scheme
- Claims analysis, data analytics, process mapping and bespoke communications to deliver efficiencies and engagement with your benefits
- Support to employers if an employee returns to work after the cessation of the benefit
Critical illness
Current statistics indicate an ever-increasing trend in the number of critical illnesses suffered by those between the ages of 30 and 64, but medical advances mean that many previously fatal illnesses are now curable. Your employees are therefore more likely to suffer from a serious illness than a terminal condition.
Group critical illness cover will provide a lump sum payment to allow your employee and their family to solve some of the financial problems that may occur as a result of a critical illness or surgical procedure – including adjustments to the home, paying off the mortgage or the cost of medical expenses, for example.
Policies provide:
- A tax free lump sum to your employee upon the diagnosis of a defined critical illness
- Valuable coverage for your children at no extra cost
- Varied levels of coverage to include your dependants, multiple medical conditions (including second and subsequent cancers) and total permanent disability
Why it matters:
- Helps minimise the pressure on your business when providing financial support for seriously ill employees
- Contributes towards the cost of medical treatment in circumstances where other benefit options, such as private medical insurance, may not available to an employee
- This in turn can sometimes help to reduce periods of sickness absence and aid a return to work
How we can help:
- World class consultative broking to leverage our scale to obtain the best outcome for you in terms of price, coverage and policy terms
- Design consultancy to meet the needs of your workforce and your budget
- Advice on a number of ancillary services, such as expert medical second opinions and cancer support groups
Dependants’ death in service
Death in service pensions give an employee’s dependants financial security should the employee die while in employment. The pension provides a regular monthly income to a financial dependant based on the employee’s salary or prospective pension.
However, with a limited market coupled with people living considerably longer, such products have become far more expensive for employers and trustees, with premiums increasing sharply year on year.
With the pensions landscape evolving and flexibility being important to employees, the traditional pension benefit may not be the right option and so alternative funding mechanisms may suit you and your employees.
Employers benefit from:
- A notable reduction in premium costs as lump sum rates are generally lower than the pension rates
- Greater market competition by approaching a higher number of life assurance insurers
- Less administration required than setting up the pension with the insurer or through the pension scheme
Dependants benefit from:
- A tax-free lump sum payment
- A tax efficient wrapper for both employer and employee if written under a non-registered policy
- Improved financial flexibility to suit the needs of the employee’s dependants
How we can help:
- Sophisticated actuarial modelling for conversion of pension into a lump sum payment to calculate the fairest outcome for both employer and dependant
- World class consultative broking to leverage our scale to obtain the best outcome for you in terms of price, structure and policy terms
- Design consultancy to meet the needs of your workforce and your budget
- Support with communication materials around pension and benefit change, particularly around design and implementation
