As the cost of living continues to bite, new research from GRiD, the industry body for the group risk sector shows that only a third of employers say they offer their entire workforce financial support if they are long term absent2 (i.e. for six months or more), diagnosed with a serious illness, or die while being in employment.
The figures rise by a third if the number of employers who say they offer support to some, rather than all, employees is considered but those employers who only offer financial support to those at a certain level of experience, seniority, or pay, are leaving those least able to cope financially the most vulnerable.
One third of employees and their families are currently left entirety without any financial support during times of a health difficulty or crisis.
|If an employee…
|is long-term absent (for six months or more) due to ill health, disability or injury
|is diagnosed with a serious illness
|dies while being in employment
|Employers who offer support for ‘all’ staff
|Employers who offer support for ‘some’ staff
|Employers who offer ‘opt in’ insurance benefits
|Employers who do not offer any support
Katharine Moxham, spokesperson for GRiD, said: “Wider industry statistics indicate that the number of employers who offer support is actually much lower in practice, and given the current squeeze on household finances, this highlights a woeful lack of financial support and security for many employees.
“As individuals, we like to think that ‘it won’t happen to us’ and perhaps, as optimistic employers, the tendency is also to think that ‘it won’t happen to our employees’ but it can and does. Support for serious issues like absence, illness and death is affordable and accessible for employers to offer their staff. We would encourage those who don’t offer any support to do some investigation and those who only offer support to some staff to consider making it available to everyone.”
The UK Group Risk industry paid out £2.22bn in claims in 2021 to 30,932 employees – equivalent to £6.1m a day, demonstrating the extent to which these employee benefits help employees and their families to cope financially when their lives take a turn for the worse.
Debunking the myths on group risk protection insurance (employer-sponsored life assurance, income protection and critical illness benefits)
· Many employers wrongly believe that providing this financial support is expensive but the cover is found in some of the most affordable benefits and can start from as little as 0.1% of payroll.
· Some employers believe that it is not their responsibility to provide financial support but increasingly staff are looking to their employer for help in all aspects of their lives. Not only is it the right thing to do, but employers who do not take suitable action risk their reputation which could lead to recruitment and retention issues.
· Employers sometimes assume that staff prefer more tangible or immediate gratification. While this may have been the case, the pandemic has meant many employees have revaluated their position and are now more likely to value financial support of this kind.
Reflecting on the disparity of only offering protection benefits to some staff, Moxham added: “I cannot imagine being on the HR team that has to tell one member of staff that they are eligible for financial support and then having to tell another that, for whatever reasons, they are not on the same scheme. When two individuals face a health crisis, they both deserve access to financial support.
“If there’s one thing we’ve learned from the past two years, it’s that we should expect the unexpected. With the right support in place, however, when life does take an unexpected twist or turn, it does not need to have a detrimental financial impact on the employee or their loved ones.