Group Income Protection
Group Income Protection is designed to help employers to manage long term sickness absence more effectively. By providing a guaranteed income for employees who are unable to work as a result of illness or injury, an employer can help to support them financially through what can be an emotionally and financially stressful time.
When income is protected in this way, the employee’s pension, National Insurance contributions and retirement plans can be maintained, despite the break in normal salary payments.
Group Income Protection benefits can be provided in many different forms, often as a percentage of the employee’s gross pay after adjustment for the level of State incapacity benefit. The benefit is paid to the employer who deducts tax and National Insurance before passing it on to the employee.
Benefits may also be protected against inflation by including an escalation option. This means that any benefit payable will increase over time at an agreed rate or in line with RPI, to a maximum of 5%.
Flexible free cover limits are often available and temporary cover will normally be available to protect the employee through the underwriting period.
Group Schemes can often be provided for as few as 4 lives.
An employer’s lump sum option can also be provided on schemes of 20 lives or more, which enables the employer to provide a lump sum of benefit at the end of a limited benefit payment term.