Zurich has launched a flexible group income protection proposition aimed at employers with at least 250 employees.
According to a statement from the firm, the new product is designed to meet the increasing need for employers to offer their workforce more flexible benefits packages to better meet individual requirements, giving the option to increase both the benefit amount and payment period.
The proposition also lets businesses to provide staff with a core level of cover, as well as the opportunity to choose from different benefit levels and payment periods, including:
• a minimum income benefit normally at 25 per cent of salary;
• maximum income benefit at the lower of either 80 per cent of salary or £350,000; and
• benefit payment periods of two, three, four and five-years or the policy terminating age.
Employees can change their benefits either at an annual window or following a ‘lifestyle event’, enabling employees to tailor their cover to meet their changing circumstances.
Nick Homer, Zurich’s corporate risk propositions manager, said that flexible benefits arrangements continue to be a growth area for the group income protection market.
“Flexible benefits arrangements are increasingly favoured by larger employers, because they enable a wide range of employee benefits to be offered, whilst also helping employers to control their overall benefits spend.”
In-work protection offers have been cited by many as a solution to the protection gap, which one study has put at around 5.2m people, with calls growing for auto-enrolment-style legislation to nudge people into taking our income insurance.
At a Zurich-sponsored conference earlier this month the pensions minister Steve Webb stated he was “open-minded but sceptical” about the government subsidising businesses to provide income protection at work.
He added the benefits were unlikely to be spread to those most in need, such as- those in fragmented employment or on zero hours contracts.
Income protection providers responded by arguing that private provision is typically superior to the more limited protection offered by state benefits.