A SIMPLE
BUSINESS
BOOST.
Group protection is a growing area
in fi nancial services. It offers an
opportunity to widen your proposition,
and this guide will help you take
full advantage.
This is not a consumer advertisement. It is intended for professional fi nancial advisers and should not be relied upon by private investors or any other persons.
GROUP PROTECTION
A GROWING MARKET.
…WITH LOTS OF POTENTIAL.
Less than three in ten employees have any group protection
Group Income Protection
Group Critical Illness
Group Life
21.7%
1.19%
5.23%
Source: Swiss Re 2015 Group Watch.
2011
30%
increase
Group protection
total premiums have
increased by almost
30% since 2011.
2011
£1,529m
2012
£1,678m
2013
£1,814m
2014
£1,957m
20142013 2012
BOOSTING AND PROTECTING
YOUR BUSINESS.
Some of your business clients may already have some group protection.
These policies need regular reviews and are a great opportunity to begin
a conversation, possibly adding more cover or including more staff.
Those who don’t have group protection yet may think it’s too expensive
or aren’t aware of the benefits to employers. That’s where you can help!
Adding group protection to your proposition could help protect your
business customers and grow your business.
Helping you introduce group protection
Private Medical Insurance (PMI)
Your client understands that health-related benefits are attractive to staff.
Group protection provides employees with financial protection should the worst happen, not just paying for treatments.
Also, our Group Income Protection’s early intervention and rehabilitation support could help employers avoid claiming on their PMI and save them money at renewal.
Auto enrolment
Pensions must be offered by all employers so adding other products can make a benefits package stand out.
Group protection uses similar information to pensions, making schemes easier to set up.
Have you discussed salary sacrifice? It helps employers to offer more employee benefits at no extra cost and employees can save money.
Business Protection
Your client understands the importance of directors and key staff, and may have protected the business against their death or critical illness.
But are their families covered? Including group protection can make your client’s benefits package more attractive to the top talent they need.
Commercial or General
Insurance
Your client understands the need to protect their business assets and cover their liabilities. Employees are also key
business assets. It costs time and money to train and develop people, so losing them can be a big setback.
Providing a financial safety net can help boost your client’s ability to recruit and keep the staff they want.
The group protection solution
Group protection is an employee benefit that can help employers attract and retain the right staff. It typically costs around 1% of payroll or less, depending on the type and amount of cover chosen; and can be included within a benefits package at no extra cost.
The growth opportunity for you
Swiss Re Group Watch 2015 called for “more adviser engagement in explaining the issues and the options for businesses”.
We’ve produced this guide to encourage this process, and are committed to supporting advisers in developing the group protection market.
Visit our website to see the support material available.
Key products
Group protection can make a huge difference to the financial wellbeing of your clients’ insured employees and families if life takes an unexpected turn.
The main products are:
Group Life Assurance and Dependants’ Pensions (‘death in service’ benefits)
Pays a cash lump sum, usually tax free, or a dependant’s pension, or both when an employee dies in service.
Group Critical Illness
Pays a tax free cash lump sum when an employee is diagnosed with an insured condition or undergoes an insured specified medical procedure.
Group Income Protection
Pays a regular income for employees who cannot work due to a defined long-term illness or injury. Benefits start after a minimum period, usually six months, and can be paid until State pension age or up to a set number of years.
We can also arrange and, where appropriate, fund rehabilitation support to help employees return to work faster.
All of our above products can also be offered to employees as either flexible or voluntary benefits, or in some cases both.
Flexible benefits
Businesses provide their employees with a standard level of benefits. Employees can top up this cover, within agreed limits, to suit their personal requirements.
Voluntary benefits
Employees can choose the level of cover they want from a range of benefits selected by the employer. Employees pay the cost of the cover through salary sacrifice or salary deduction.
Long-term insurance arranged
through employers now provides
80% of all insured coverage in
the UK.
Source: Swiss Re Group Watch 2015.
DEVELOPING YOUR
GROUP PROTECTION OFFER.
A competitive job market can make it harder to attract people,
and the costs of replacing a leaver make it even more important
to retain the right staff.
Premiums will depend on a range of factors, such as type of benefit, amount of cover and scheme size.
TYPICAL COST
Use our online calculator to get a more accurate indication
legalandgeneral.com/gpcalculator
It gives quick quotes for Group Life and Group Income Protection schemes insuring 10-500 employees.
Average number of employees covered* Average premium* Typical commission (% of premium)
Group Critical Illness 167 £25,559 4%
Group Life and Dependants’
Pensions 178 £25,744 4%
Group Income
Protection 121 £37,045 12%
Costs less than you might think?
How much can you earn?
Here’s what other employersare offering.
We’ve analysed our whole portfolio, and this table shows the most popular benefit level for each product by scheme size.
Most popular level of benefit
Number of employees covered
1 - 50 51 - 250 251 - 500 1,000501 - 1,001 + Group Life
(multiple of salary) 4x 4x 4x 4x 4x Group Income
Protection (% salary) 63% 68% 62% 63% 59% Group Critical Illness
(multiple of salary) 2x and 4x 2x 1x 1x n/a
How much cover should clients offer?
You can charge your client commission or a fee. Commission is added to the premium, and the rate is flexible.
This table shows the average scheme sizes and premiums in 2014, plus typical commission rates for each product.
Commission is payable every year of the policy.
Group Life
0.15%
of payroll
Group Critical Illness
0.5%
of payroll
Group Income Protection
1%
of payroll
MAKING IT EASIER.
The faster way to get quotes
• Competitive premium rates.
• Quotes guaranteed for three months.
• Group Protection Calculator – get a quick quote for Group Life
and Group Income Protection schemes insuring 10 to 500 employees. Just answer fi ve simple questions.
• Online Quote and Buy – perfect for use with your SME clients. Get a full quote in 15 minutes for Group Life and Group Income Protection schemes insuring 10 to 250 employees.
Contact us to discuss larger schemes and get a quote:
Call 0345 072 0751
We may record and monitor calls. Call charges will vary.
Or email [email protected]
Our dedicated support and online systems are designed with advisers in mind,
enabling you to get quotes and place policies on risk quickly and easily.
Easy to complete
• Usually no medical underwriting.
• Our online Quote and Buy system has a 97% recommendation rate from users and lets you make schemes live instantly.
• You’re likely to have much of the necessary information already.
• Our dedicated team can help you complete larger schemes as smoothly as possible.
Simple administration and renewal
• Rates are usually reviewed every two years.
• We only need annual updates of payroll information. • The scheme can be assessed annually with commission
Reassurance for you
and your clients
We’re a top UK provider of group protection cover in the UK, with 85 years’ experience and knowledge. You can be confident when introducing our group protection products.
Group protection claims paid in 2014
We also arranged and funded rehabilitation treatments worth £4.6m.
GIVING YOU CONFIDENCE.
We looked after more than
4,800
group protection
policies and almost 2m
employees in 2014.
Overall,
we paid
97.4%
of claims
Group Life and Dependants’ Pension
99.6%
of claims paid
Group Critical Illness
82.4%
of claims paid
Group Income Protection
95.0%
of claims paid
£220m
total value
£8.6m
total value£39.8m
total valueAll our products include a comprehensive
Employee Assistance Programme.
We’re the only group protection provider to offer this free benefit with all our products, and can even include employees not in the scheme.
0345 072 0751
We may record and monitor calls. Call charges will vary.[email protected]
legalandgeneral.com/workplacebenefi ts/advisers/protection
WE’RE HERE TO HELP.
Our specialist group protection team is on hand to help you
and your business capitalise on potential opportunities.
Register for our newsletter and keep up to date on group protection matters, just email your details to:
[email protected]
Legal & General Assurance Society Limited Registered in England and Wales number 166055.Authorised by the Prudential
Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Registered office: One Coleman Street, London EC2R 5AA.
