Group critical illness schemes are often integrated with other benefits in order to provide a very wide range of protection and assistance for staff.
It is important to appreciate that group critical illness cover is a benefit which is payable in the event of an insured person presenting with a “critical” condition. They do not have to be incapacitated from work or pass away. Indeed, for the core conditions, they need to survive for a certain period after diagnosis which is usually 28 or 30 days.
A plan would normally cover three main conditions of stroke, heart attack and most forms of cancer to which would be added a range of other conditions such as major organ transplant, kidney failure etc.
Many people diagnosed with these serious illnesses are able to make a full recovery and return to work and with a plan normally providing a lump sum payment, upon diagnosis, it can help employees through their treatment and recovery. It can be used in any way that a claimant chooses with many people selecting specialist treatment or nursing care, reducing major outlays such as mortgages or making changes to the home or lifestyle. Group critical insurance can go a long way towards helping staff not only cope at a traumatic time but also make the best possible recovery.
Product Features
In contrast to a group life assurance scheme, which pays a benefit upon an employee’s death, group critical illness cover is often known as “living assurance” as a benefit is paid as a tax free lump sum should an employee be diagnosed with one of the conditions covered under a plan and survive for a minimum period as mentioned above.
In addition to the primary or core covers, again mentioned above, which not surprisingly form the majority of claims, a plan will often be extended to include a range of other conditions to suit an employer’s requirements and budget.
It is also possible to extend cover to include an employee’s spouse and/or children.
Some employers will often choose to offer group critical illness insurance as part of an overall benefit structure with it being made available to certain categories of employees only e.g. executive and managerial staff.
Benefits for Employers
- Flexibility for a scheme to reflect a level of cover that is within an overall employee benefits budget.
- Provides financial assistance at a traumatic time.
- Affords excellent support to an employer who might not otherwise know how or when to assist a valued employee.
- Premiums are normally treated as a trading expense of the employer
Benefits for Employees
- Provides cover for the most commonly suffered critical illnesses.
- Provides a lump sum payment in the event of serious illness.
- Gives financial help and support during difficult times.
- Option to include cover for spouses and children.
The above information regarding taxation is based upon our understanding of current legislation which, of course, is liable to change in the future and would depend upon an individual’s financial circumstances.
If you would like further information on group critical illness schemes then please email Nicola Hemmings or call her on 0845 3081482.