Advisers urged to discuss group protection

Advisers urged to discuss group protection

Advisers should make an effort to speak to their corporate clients about group protection, an industry body has said, as research showed employers struggled to manage their employees' needs.

Katharine Moxham, spokesperson for Grid, the industry body for group protection, said it made "good business sense" for advisers to talk about group risk.

She said the world of employee benefits had changed as auto-enrolment and other measures meant conversations about employee benefits were opening up.

This in turn was providing advisers with the opportunity to consult with employers on group risk, she said.

She also thought there was increased competition for client retention in the adviser space as “proving value and demonstrating return” had “never been tougher”.

Group protection products are insurance policies — such as life insurance, income protection or critical illness — taken out by an employer for their employees.

Research from MetLife, published yesterday (July 25), showed that just 40 per cent of employers felt they were doing enough to help staff build resilience while 57 per cent of those polled thought they needed to do more to support their staff.

The protection provider polled 1,068 employers last year and found 84 per cent said in particular there was no clarity on best practice to address mental health issues.

Ms Moxham said group risk could be a “simple, cost effective” way of providing this support.

Products such as group income protection often come with extra services — such as access to counselling, therapy and ‘get back to work’ schemes — that can help employers and employees manage workplace stress, according to Grid.

She said: “Group risk is an integral part of the whole benefits package and has touchpoints with other benefits. 

“Employers want guidance on all, so the more areas an adviser can assist with, the more it will help them retain clients and help them protect their own business.”

Ms Moxham pointed out that the group risk market had been growing over the past years — a trend she put down to the fact more employers were seeing the value of the product.

The latest Swiss Re Group Watch report showed the number of people insured under group-risk policies increased by 3.3 per cent in 2018.

But others figures have shown the market is still ‘untapped’. Research presented by Canada Life at the Protection Review conference earlier this month (July 11) showed only 4 per cent of employers had group life insurance, 1.2 per cent had group income protection and 0.2 per cent had group critical illness.

According to Chris Morgan, head of group protection distribution at AIG Life and speaking at the conference, this meant advisers were "well placed to capitalise" on this shortfall.

Ms Moxham added: “No other benefits provide such a financial lifeline when it is most needed: during catastrophic times in an employee’s life. 

“Employers that look after their staff in such a way are the ones that have greater employee engagement, better absence-management and higher productivity. Conversely, it doesn’t go unnoticed by employees if a colleague hasn’t been looked after by their employer.”