Give your employees the surety of a regular income should they be unable to work with group income protection insurance.
Group income protection is a type of insurance policy that gives your employees financial support if they cannot work due to ill health or injury. It allows employers to offer valuable extra support to their staff for the price of a monthly premium.
Providing financial protection through illness or injury is a precious benefit to your employees. However, paying an employee's salary is expensive, especially when they're not working. Group income protection policies cover employers for this expense, paying the employee a monthly benefit in exchange for a monthly premium.
While your employees can purchase their own income protection insurance to cover their salaries during long-term absence, it's great for companies to offer it to their people as a benefit.
Here's how it works:
The deferred period is the time between an employee stopping work due to illness or injury and the monthly payments beginning. Employers can choose how long they would like the deferred period to be, the longer it is, the lower premiums will be. Some insurance providers offer deferred periods of 8, 13, 26, 28, 41 or 52 weeks. Select the most suitable deferred period for you and your employees.
Group income protection is a valued benefit to offer your team and takes into account that Statutory Sick Pay for many wouldn't be enough to live on.
Buying group income protection insurance is as simple as purchasing any insurance policy, such as group life or critical illness cover. Talk to our expert advisers to find out more.
Group income protection covers insured employees for almost any illness or injury that stops them from working. This sets it apart from critical illness cover, which only covers a specific list of conditions. That cover will run until the employees are well enough to return to work, retire, or the policy term ends, whichever comes sooner.
Most income protection policy providers offer optional add-ons so you can offer even better support services to your staff. Additional benefits include:
Like other types of insurance, group income protection exclude certain conditions from their cover. Exclusions will vary between insurers and policies. However, most policies will exclude pre-existing conditions, self-inflicted injuries, misuse of drugs or alcohol, and injuries resulting from a criminal act and war. Please speak to us or check your documentation for full details of exclusions on your policy.
The price of your group income insurance depends on several factors, including:
Each policy will have maximum benefit levels attached. Primarily they will detail the maximum percentage of an employee's salary that's covered, the pension contributions included (if any), the largest possible lump sum payment and the maximum duration of payments.
In theory, you can register any of your employees for group income insurance. However, many companies use specific criteria to decide who can receive this benefit and who can't. Some companies restrict access by the age of employees or their length of service. Others will only offer cover for specific job titles or even departments. Ultimately, it's up to you to whom you would like to benefit from the policy. You could even set up multiple policies with differing cover levels and deferred periods for different people in the business.
Many companies use group income protection as part of a suite of flexible benefits they offer their employees. These benefits bring similar advantages to employers as income protection, including boosting staff retention, promoting your company as a better employer, and making your company a better workplace.
If you're considering group income protection, you should also think about the following:
If you already provide life insurance to your employees with cover for critical illnesses, you may wonder what the difference is and why you would need group income insurance.Critical illness cover pays your employees a tax-free lump sum if they contract a condition on the insurer's coverage list. Because it is a lump sum payment, depending on how long the employee is absent from work, more might be needed to support them financially through the entirety of their illness.Income protection pays out if an employee cannot come to work, regardless of sickness or injury. It also pays out monthly rather than in one large payment. It protects the employee from a long-term inability to work, although it is often used as a short-term solution. Some policies will guarantee an income until retirement, providing long-term security.
Let's look at four of the UK's leading group income protection providers.
Aviva's group income packages are here to help you help your employees through good times and bad. It aims to take an end-to-end approach to your people's health, promoting healthy living and supporting them when they're sick.
Depending on your level cover, Aviva will:
Legal & General aims to simplify group income protection for companies that want better benefits for their people. It promotes a deferred period of 26 weeks before an employee can receive payment, but you can choose a waiting time that suits you.
Benefits for employees include:
Zurich offers group income protection for your employees aged between 16 and 69. It aims to be simple to buy and manage, including the facility of a paperless claims process that includes eSignatures.
Features on offer include:
