Group Income Protection

Your employees are your greatest asset. Our Group Income Protection enables you as an employer to continue to pay a proportion of your employees' earnings if they are unable to work due to illness or injury for a prolonged period.

Group Income Protection is designed to help employers manage long sickness absence more effectively. It is also a valuable benefit to attract and retain employees, which is becoming increasingly important.

By providing a continued income for employees who are unable to work as a result of illness or injury, Group Income Protection helps employers assist in the financial support of their employees at an emotionally and financially stressful time.

You have two options:

Employer Funded

Employee Funded Extension

Can help you meet your legal and financial obligations and your own sickness scheme financial liability
In most circumstances Group Income Replacement premiums count as a business expense for tax purposes
Offering a range of employee benefits, including Group Income Replacement, can attract and improve retention in employees
Absences can be more effectively managed

Key Features

Choice of Deferred Periods from as soon as 4 weeks
Range of benefit claim payment periods shorter term from 26 weeks or to retirement
Insure to a maximum of 75% of employee income, up to £180,000 per employee
Free cover limit, based on number of employees, helps simplify health underwriting

Protecting Your Greatest Asset

Product Summary

Core Technical Guide

Comprehensive Technical Guide

As an employer you need to have already set up an employer funded Group Income Protection plan for your employees.

If that plan has a fixed benefit term, it means that cover will come to an end after a defined period. Employees would then have no further cover.

By adding an Employee Funded Extension plan to the main scheme, employees can then take out their own cover extension on terms that they choose as below:

Contributions made by the employee through salary deduction, from income, after the deduction of income tax.
Benefit then paid to the employee is exempt from tax (under current HMRC rules).
The deferred period, or waiting period before the claim benefit starts to be paid, is linked to coincide with the end of the employer plan cover.
The employee can choose to insure up to 50% of their basic annual salary.
The cover can be for a 2 or 5 years fixed term per claim, or run through to the members plan retirement age.
Employees will be subject to medical underwriting at outset in relation to the extension cover.

If the employer funded plan covers employees right through to their plan retirement age, an employee extension may still be an option if the employer has not chosen to cover the employee to the maximum limit – the two schemes together cannot exceed 75% of basic annual salary in total.

Jon Cummings

Senior New Business Administrator

jon.cummings@wiltshirefriendly.com 01225 756794

Jon Cummings

Senior New Business Administrator

jon.cummings@wiltshirefriendly.com

01225 756794

Jon’s background is in the Financial Services industry working for Financial institutions.

Working with the Society since November 2016, Jon has oversight and control of all aspects of the new business processes.

Jon is a sports enthusiast, and when family life allows him to, he enjoys playing golf, football and skiing.

Look After Your Business And Your Staff

A leave of absence due to sickness or injury can be a difficult and stressful experience, for both the employee and the employer. You don’t want your employee to worry about money and try to return to work before they’re fit, but equally you wouldn’t want to be paying a staff cost for a job that isn’t being done. A Group Income Protection scheme is a type of employee benefit insurance that can offer your employees some financial security and offer you, the employer, some financial protection whilst not necessarily breaking the bank.

Group Income Protection is a type of sick pay insurance for small, medium or large businesses, designed to help both employers and employees in the event of sick leave. When an employee is unable to work due to illness or injury, Group Income Protection insurance will pay an agreed proportion of their income.

Have a specialist insurer on your side

At Wiltshire Friendly Society we have decades of experience in income protection and help our clients to understand what Group Income Protection is, how it works and what the benefits of income protection insurance are for small, medium and larger businesses.

Contact Wiltshire Friendly today

What is Group Income Protection insurance?

Employees are a business’s greatest asset. Group Income Protection for businesses is a valuable benefit to attract and retain employees, which is becoming increasingly important. Designed to help employers support sickness absence more effectively, Group Income Protection insurance usually pays up to 75% of an employee’s income if their illness or injury prevents them from working.

Employer funded Group Income Protection

Employer funded Group Income Protection enables you as an employer to pay employees a proportion of their earnings if they are unable to work due to illness or accident.

In this type of Group Income Protection, the income replacement benefit is claimed by and paid to you the employer, before being passed on to the employee through normal payroll.

Employer funded income protection not only shows your employees that you care about their wellbeing, but can also help you to meet your financial and legal obligations, such as Statutory Sick Pay and your own sickness scheme financial liability.

You select the level of protection you want to provide to your employees, based on their earnings. At Wiltshire Friendly, our plans have been designed so that you are able to choose from a range of features and cost-related options to fit within your business and employee requirements.

The maximum benefit you can insure for each employee is 75% of their total earnings, up to a maximum sum insured of £180,000. This can be paid for any length of time from 6 months until the employee reaches state pension age. Benefit payment will stop when the individual returns to work.

If an employee is not fully able to return to work, such as partial rehabilitation, the benefit may still be payable on a proportionate basis.

Group Income Protection premiums paid for by the employer are normally treated as a deductible business expense. Benefit received under a claim is classed as business income and is taxable and when paid under PAYE to an employee is a trading expense, hence tax neutral. (Based on current legislation and HMRC practice.)

Group Income Protection for a small business can be a way of retaining existing staff and attracting new staff. If you are a larger business it could help offset your existing sick pay liability and reduce your sick pay costs.

Your local income protection providers since 1887

At Wiltshire Friendly Society we have over 130 years of experience in providing the savings and protection needs of their members. We are a proud member of the Association of Financial Mutuals (AFM), meaning that we are owned by our members, and operate for their benefit.

Contact us today to discuss a Group Income Protection plan that suits the requirements of your business and employees.

Frequently Asked Questions

What is income protection?

Income protection insurance is an insurance policy that regularly provides the policyholder with a percentage of their income if they are unable to work due to illness or injury. This regular income will continue either until the policyholder retires or they are able to return to work. If you’d like to learn more about income protection, read our article.

What is Group Income Protection?

Group Income Protection insurance is a policy, taken out by the employer, that provides financial protection to employees in the event they are unable to work due to illness or injury.

Is income protection insurance the same as critical illness cover?

No, income protection insurance isn’t the same as critical illness insurance. Critical illness cover provides a single payment if the policyholder is diagnosed with a medical condition specified in their documentation. These conditions include serious illnesses such as cancer, heart attacks and strokes.

The aim of critical illness insurance is to offer financial support to the policyholder in order to help with medical expenses, living costs and any other payments that arise due to the illness (think hospital car park charges etc.)

Income protection is not a single payment. Instead, it is a regular payment that replaces a percentage of the policyholder’s income should they be unable to work due to their illness or injury. Learn more here.

What is short deferred Group Income Protection?

Group Income Protection can provide income replacement to employees after a waiting period of just 4 weeks following an illness or injury. Longer waiting periods are also available such as 8 weeks, 13 weeks or 26 weeks.

What is limited benefit Group Income Protection?

A limited benefit term plan pays a regular payment for a set period, which can be as short as 6 months, or 1 year, 2 years, 5 years.

Does Group Income Protection benefit employers in terms of recruitment and retention?

By providing a financial safety net for employees', Group Income Protection can enhance the attractiveness of the company as an employer, helping recruitment and contributing to employee loyalty and retention.

How long does Group Income Protection cover last for an employee?

The duration of coverage varies but is provided for a specified period, either an agreed period or until retirement, stopping sooner if the employee returns to work.