Group Income Protection (also known as Permanent Health Insurance) products are used as an employee benefit to provide a replacement income in the event of a long term absence through illness or an injury that renders them unable to work. Benefits are usually provided after a prescribed period of absence, known as a “Deferred Period”. During this period the insurer will actively work with the absentee to help rehabilitate them into the work place. This works for both employer and employee, as the employee benefits from the very best care available and the employer benefits from a quicker return to work.
Employees are actually 3x more likely to get a long term illness or injury than die during their working life,1 and, with total costs of absence impacting businesses, on average by £638 per employee per year.2 It’s no wonder Group Income Protection in seen as both a valued Employee and Employer Benefit. Managing absence in the work place can be a real headache, it’s time consuming, cumbersome and can take focus away from what’s really important – running the business! The modern day Group Income Protection plan is more than just about paying long term claims, but will support the Employer in pro-actively managing their absence strategy.
Income Protection pays a proportion of your employees’ salary if they are unable to work, with various scheme designs available, such as capital option lump sum and even cover from just 4 days absence. Through comprehensive claims management, Employers have access to ‘Early Intervention’ to help restore skills and support rehabilitation back to work successfully.
Once seen as a benefit for only ‘top tier’ employees, schemes can be designed to provide at least a level of cover for essential financial commitments, from £200 a year per employee.
A review of your benefits package can reveal new ways to extend income protection benefits to all your employees whilst managing budgets.
2 CIPD Absence Management Survey Report 2011
*please obtain your own tax advice from a professional specific to your own circumstances before making any decisions