Protection 

Government should incentivise firms to provide cover

Government should incentivise firms to provide cover

Government should do more to encourage companies to offer protection within their benefit schemes, Paul Moulton has said.

The director of intermediary distribution for Axa PPP Healthcare, said it was right for the government to suggest insurers and employers could do more to make medical insurance more affordable and more attractive to employees, but said even more could be done to encourage firms to offer insurance.

"Companies will consider insurance as a 'new spend' and for a discretionary benefit this could be seen as expensive.

"And such a benefit, once offered, is very difficult to take away if the company needs to cut costs. 

"Therefore, workplace insurance could be better incentivised by government. I think government needs to make a decision about how to do this, perhaps even bringing rudimentary insurance into a form of quasi-compulsion, incentivised by a reworking of the tax structure."

In 2014 the Association of British Insurers, in its Welfare Reform for the 21st Century report, mooted the possibility of an auto-enrolment treatment for workplace protection, incentivised through the government's tax system.

In 2016, the Department of Health and the Department for Work and Pensions issued an 88-page joint consultation paper, Improving Lives - The Work, Health and Disability Green Paper, which said insurers needed to do more to make income protection packages more attractive and less expensive, so employers could implement these cheaply.

But Mr Moulton said the insurance industry had already been improving their medical insurance policies, with insurers promoting health and wellbeing to get more people rehabilitated and back into work.

But it seems to be the government's "Plan B to make people wait" for state benefits. However if there were some form of government-incentivised auto-enrolment for insurance, it could benefit far more people and take people away from the state.

He said: "Protection as a benefit can really help employees but if you look at the typical corporate client, the ones offering protection or private medical insurance tend to be white-collar firms or the so-called 'knowledge workers'."

Arguably, Mr Moulton said, these are less likely to call on PMI than blue-collar workers in industries where there is a higher chance of a workplace accident, yet many firms across the UK do not have even basic insurance benefits offered to their employees.

Where there is some form of cover, he said this tended to be skewed towards the executives rather than extended as a benefit to all staff.

The latest figures from the Labour Force Survey showed an estimated 137.3m working days were lost due to sickness or injury in the UK in 2016.

Ian McKenna, director at the Finance & Technology Research Centre, said: "Anything that reduces financial stress in the workplace would have potential productivity benefits for both employees and the nation.

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