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78% employees with employer provided Group Life cover feel more valued by their employer
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78% employees think it is an important consideration in any job move, with 18% confirming they would not move jobs without it
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71% employees who have purchased their own individual cover would feel more valued if it had been provided by their employer
54% of employees surveyed who have employer funded GLA in place see it as a “must have” benefit; 32% say it provides peace of mind and ensures their families are protected and 22% say it reduces or negates the costs they would have to find to purchase these benefits themselves. An additional third (33%) say that, whilst it is not essential, the benefit would certainly be a “nice to have”.
Of employees who have GLA in place, 27% believe it is more important than private medical insurance, 26% say it is more important than receiving an annual bonus and 16% rate it more highly than the provision of income protection during ill health or injury.
Improving economic conditions heighten importance of employee benefits
With economic conditions improving, employees are likely to be offered greater employment opportunities, which could leave employers facing increased competition for the best staff. This is where a strong employee benefits offering could make a significant difference to an employer’s appeal; 61% of those surveyed who purchase their own individual life protection say it would improve their perception of their employer if this was provided for them. This could be a valuable boost to those aiming to improve employee recruitment and retention.
The findings certainly suggest that GLA is a worthwhile investment for employers and a desired benefit by employees: 78% of employees with the benefit say it would be an important consideration in any job move, including 18% who state that they would not move to a new job if Group Life Assurance was not offered as part of the benefits package.
The cost of life assurance
The premiums paid by those surveyed who purchased their own individual life protection varied greatly, depending on the cover provided, but averaged out at about £25.51 a month (£306 a year). In some cases it can cost significantly more, as 3% stated that they paid more than £100 a month to buy life cover.
Group life cover is considerably cheaper than individual cover but there is a misconception about the cost. 44% of those who paid for their own protection estimated that it would cost their employer 1%-2% of the payroll to provide cover on their behalf but a further 21% assumed it would be more than 3% of payroll.
This misconception is also prevalent amongst smaller employers. A Canada Life Group Insurance survey(1) of small-medium enterprises (SMEs) in April 2015, showed that 91% believed providing GLA would cost them more than 1% of their salary payroll, with 45% thinking it would be over 3%. In reality GLA typically costs the employer less than 1% of payroll.
Paul Avis, Marketing Director, Canada Life Group Insurance commented on the findings:
“Group Life Assurance can provide much needed financial and emotional support to those who lose a member of their family, especially when that member is the main breadwinner. Simply CLASS (2) is our online platform, allowing advisers to offer a simple Group Life product to employers quickly, efficiently and cost-effectively.
“From the 1st June pension auto-enrolment (AE) of SMEs (with less than 50 staff) began. Soon all employers will be offering a pension to their staff. An improving economic outlook and better employment prospects mean that the fight to attract and retain quality employees will intensify, so employers will need to find new ways to differentiate themselves. In my view, all employers should start to consider whether their current benefits package supports a contented workforce and Simply CLASS allows advisers to easily demonstrate how little GLA would cost.
“As demonstrated by our research findings, employee benefit offerings can increase how valued an employee feels and almost one in five (18%) who have GLA would not be willing to sacrifice it for a new job. Many group protection products can be brought in at a relatively low cost so, by reviewing their current benefits offering, employers can take the opportunity to stand out from the crowd. Those who fail to take note of this could risk missing out on hiring or keeping some of the best talent available.”
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