Why SMEs Offer Group Income Protection

In Business, Industry News, Protection by Stephen Ellis

As the responsibility for ensuring the wellbeing of employees is increasingly falling on the shoulders of employers, Group Income Protection is something that more and more businesses are taking advantage of.

Widely seen as the jewel in the crown of employee benefits, Group Income Protection provides excellent financial and emotional support for employees when they are working through a sickness or injury. In fact, its importance was even the subject of a parliamentary debate just last month, which highlights the kind of attention this key workplace benefit is receiving right now.

But in addition to helping businesses fulfill their obligations when it comes to looking after their staff and the families of their staff, why else do companies offer Group Income Protection?

According to new research from industry body GRiD – which represents the group risk protection sector (employer-sponsored life assurance, income protection and critical illness cover) – 25% of SMEs use Group Income Protection to differentiate themselves from their competition when it comes to recruitment and retention.

A further 22% of SMEs said Group Income Protection is a tax-efficient benefit, while 23% say they recoup the cost of the benefit through improved staff morale and productivity. Just under one in five (19%) use Group Income Protection to help manage long-term absence.

Statutory Sick Pay Simply Not Enough

Another primary reason why businesses offer Group Income Protection is because they believe Statutory Sick Pay (SSP) does not provide enough support when an employee is unable to work.

Speaking about the findings of the research, Katharine Moxham, spokesperson for GRiD said Group Income Protection doesn’t just benefit employees.

“Employers too have access to specialist advice, case management and mediation. When employers utilise the benefit to the full they get great value”, she said. “We’re pleased to see that many are making the most of the benefit, but we’d like to see better utilisation. This is a benefit that’s designed to be regularly accessed by all – not simply left on the shelf for an emergency.”

Group Income Protection is particularly crucial for supporting workplace mental health issues. In fact, mental ill health is the biggest cause of claim on the insurance.


Related reading: Work-Related Mental Health Issues Now Account For Over Half Of Work Absences]


In short, Group Income Protection provides the following support for employers:

  • Absence management
  • Early intervention programmes
  • Help with identifying absence patterns
  • Management training
  • Advice for HR, line managers and business owners

It also provides the following support for employees:

  • Core financial benefits
  • Access to health apps and advice
  • Support during a diagnosis (for example, a second medical opinion)
  • Vocational rehabilitation services and support following an illness or injury
  • Employee Assistance Programmes

“For between 0.25% and 1% of salary roll, GIP packs a powerful punch but it works best when employers work with advisers and providers to extract all of the treasures that lie within”, added Moxham.

You can find out more about Group Income Protection, including how Premier Choice can help, on our dedicated Group Income Protection page or contact us for a free, no obligation quote.

Stephen joined Premier Choice in 2006 as a Group Risk consultant and became Head of Group Risk in June 2013. In December 2017, Stephen also took over responsibility for the Protection division within Premier Choice and works to grow this in the same way he has the Group Risk division. Protection is a specialist area and fits well with his experience and expertise in the group risk market.