Group insurance may prove to be important to your organisation in a number of ways.
Of course, before discussing how it may be able to benefit a company, it might be worth clarifying exactly what group cover insurance typically entails.
Some insurance providers specialise in offering group schemes, such as those offered under the Drewberry group insurance
This type of insurance offering may include cover such as:
life insurance - as the name suggests, this pays your employees (or more correctly their beneficiaries) a lump sum in the event of their premature death in service;
income protection - a form of cover designed to meet up to typically 75 percent of an employee’s earnings in the event that they are long-term sick and unable to earn an income;
critical illness insurance - this provides a lump sum for any employee diagnosed as suffering from one of a specified range of critical illnesses;
business protection insurance - they are a number of flavours of this, offering financial contributions in different circumstances.
Examples might include compensating the business for the death of a critically important employee or providing funds for the purchase of a key shareholder’s holdings in the event of their death - something that might help you retain control of your business.
If perhaps the benefits of the final cover type above are clear, you may be wondering what are the advantages of the first three points in terms of the organisation as opposed to the individual.
This question cuts to the core of modern business practice in which organisations may be very keen to achieve two things in terms of their human resource management:
To reduce staff turnover as far as is possible given the significant costs and disruption that arises when people leave your organisation and you need to move back into recruitment mode;
To provide the most cost-effective total benefits package possible, both as an aide to staff retention and in order to de-emphasise the preoccupation on cash in benefit negotiations.
Insurance benefit schemes may prove to have an important role to play in terms of increasing your employees’ assessment of the value of their total remuneration package and thereby reducing staff turnover.
Showing that your organisation also accepts a commitment to them and their families in the event that misfortune strikes, may also increase team spirit and loyalty.
Solutions fit for purpose
Of course, different insurance providers may have different versions of the above products.
It might also be possible to customise the benefits to suit your specific business environment and requirements. For example, you may wish to vary the percentage of the income protection benefits payable.
These options may be a powerful management and business direction tool to have at your disposal.