How your organisation could benefit from Group Income Protection

How your organisation could benefit from Group Income Protection

A good employee benefits package can help your organisation attract and retain high quality talent. In recent times, Group Income Protection policies have become one of the most sought-after benefits for prospective hires.


A good employee benefits package can help your organisation attract and retain high quality talent. In recent times, Group Income Protection (GIP) policies have become one of the most sought-after benefits for prospective hires.

Group Income Protection is an insurance policy that provides a proportion of an employee’s salary if they are unable to work because of ill health or an injury. Not only does Group Income Protection help your employees while they are recovering, but most policies now offer preventative support that can reduce costs and time off work down the line.

If you do not have Group Income Protection arrangements in place at the moment, it may be worth considering how much your organisation could benefit from such a safety net.

Benefits for your organisation

The main advantages of Group Income Protection arrangements for you include, but are not limited to:

  • Reducing the amount of time sick employees spend off work by providing prevention resources and supporting their rehabilitation.
  • Protecting your organisation from the potential financial ramifications of paying long-term sickness income.
  • Tax relief is usually available on the premiums paid by employers as allowable business expenses even though GIP is not a P11D benefit.
  • Promotes a positive image of your organisation to your staff and the general public.

Benefits for your employees

There are several benefits that your employees can receive from Group Income Portection policies:

  • The main advantage is receiving financial support while away from work and the lowered level of stress can be crucial for their recovery.
  • Group Income Protection arrangements often do not use medical underwriting. Therefore, your employees may have greater mental and physical cover than what would be offered under a personal plan.
  • Resources and information that promote healthy living and wellbeing.
  • Rehabilitation support that will help a sick or injured employee recover quickly before returning to work.

How Group Income Protection policies work and what is covered

As an employer, you will pay a contracted premium. Should an employee be unable to work, due to an illness or injury for an agreed period of time, then you can submit a claim.

You should be aware that the insurer will pay out the money to your organisation, not to the employee in claim. The payment is made through your Pay As You Earn (PAYE) system and paid to the staff member as salary.

The amount of cover will vary depending the level you choose and on the insurer’s maximums. Typically, a policy can cover:

  • A percentage of an employee’s salary until they either: return to work, reach a specific age, or for a limited amount of time as agreed in your contract.
  • Your Employer National Insurance Contributions for the employee.
  • Contributions into the employee’s pension scheme.
  • Benefit increases during the period of payment.

Things that you should first consider

Every organisation’s workforce is different and, therefore, you need to consider how yours will benefit the most from Group Income Protection arrangements. You should analyse:

  • Whether you are only going to insure staff salaries or if you wish to include other finances within the policy as well. For example, you may want to consider covering employer National Insurance Contributions and pension contributions.
  • What level of income do you want to protect? You can adjust this detail depending on the seniority of the employees protected by the policy.
  • There is a waiting period before benefits are paid out and this ranges from 13 to 104 weeks. You will need to decide how long you want this deferred period to be as this may impact the premiums you must pay.

How can we help you?

There is a lot to consider when it comes to Group Income Protection policies, but we can help you navigate your options and tailor the best solutions for your organisation.

If you would like to discuss the options that are available, or if you wish to arrange an initial no cost, no obligation, consultation, then please fill out the contact form below. Alternatively, you can call 01603 706 820 or email

Important information

The insurance protection products discussed in this article are not savings or investment products and have no cash value unless a valid claim is made. The tax treatment of any policy may depend on your individual circumstances and may be subject to future change.

While considerable care has been taken to ensure this information is accurate and up-to-date, no warranty is given as to its accuracy. This article constitutes a financial promotion.

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