Group Income Protection provides a replacement income based on a percentage of the employee’s salary if an employee is unable to work because of long-term illness or injury. As well as the financial support, it also provides employers with access to rehabilitation services that help employees return to work, available from the earliest stages of absence.
The policy also supports absent employees back into work with expert advice and guidance thus strengthening an employer’s benefits package with a range of valuable support services.
Group Life policies often include an Employee Assistance Programme and as such offer specialist counselling and helplines to all employees.
Cover is based on a percentage of the employee’s salary, normally up to a maximum of 80%. Levels of cover can be considered with pension scheme contributions in mind (both employee and employer contributions) and National Insurance contributions.
There are various claim payment options, for example the benefit could be paid for a limited number of years, or until the employee reaches the cease age of the scheme (this normally tying in with their retirement age).
Any benefits paid to the employees are subject to PAYE taxation and premiums paid by the employer will normally be treated as an allowable business expense. There is currently not P11D “benefit it kind” tax liability** for the employees in respect of the premiums paid by the employer on their behalf.
**HM Revenue and Customs practice and the law relating to taxation are complex and subject to individual circumstances and changes which cannot be foreseen