More than 12 million individuals were covered by group risk schemes at the end of 2016, according to research by Swiss Re.
Its Group watch 2017 report, which is based on data collected from 16 providers in the group risk market in the UK and 18 employee benefits consultancies, also found that 520,000 more people became members of group risk schemes by the end of 2016 compared to 2015, representing an increase of 4.5%.
The research also found:
- In-force death benefit sums assured increased by 4.4% in 2016.
- Excepted group life non-pension benefits increased by almost 30% in 2016.
- In-force death-in-service pension benefits fell by 6.8% in 2016.
- Critical illness in-force sums assured increased by 9% in 2016, and premiums increased by 11.5%.
- Long-term disability income policies increased from 17,111 to 17,168 in 2016, and the total insured benefits increased by more than 9%.
- The number of people insured for long-term disability income increased by 6% to more than 130,000 individuals.
Ron Wheatcroft (pictured), technical manager at Swiss Re, said: “The stand-out figures in the data show the increase in excepted group life cover and there are other good signals too, including a reverse in the decline of long-term disability income in-force policies. This is particularly relevant with the spotlight in the [Department for Work and Pensions] and the [Department of Health] green paper published late last year on the potential for growth.
“The growth in excepted group life policies reaffirms the need for clarity across the whole market around these arrangements. An exemption, where the [excepted group life policy] is the sole asset, would confirm these arrangements as an efficient and effective way for employers to provide life cover as the link between pension provision and death benefits becomes less direct.”