Group Income Protection (PHI)

Group Income Protection, also known as Permanent Health Insurance or Long Term Sick Pay, is an often overlooked, yet increasingly valuable employee benefit.

Many employers will continue to pay employees for a period after the onset of incapacity. In the event of a long-term incapacity however, the employer, if only for commercial reasons, will be reluctant to do so indefinitely. The employer may then be confronted with an unpleasant moral dilemma, of whether to continue income beyond any contractual obligation period, particularly where a long serving and loyal employee is concerned.

A Group Income Protection scheme can provide an ideal solution to these problems.

Group Income Protection is a form of insurance that is designed to provide employees with a continuing income, payable in the event of incapacity arising out of accident or illness. The benefit will continue until the employee recovers, dies or reaches the previously agreed ceasing age of the policy, which is often selected to coincide with normal retirement age.

A major advantage of group income protection is the level of cover available before medical evidence is required. This enables members who may not be in good health and who would find it difficult to purchase their own individual policy to receive some cover. The free cover limit increases as the scheme grows larger.

Another advantage is that premium rates are cheaper for group schemes than for individuals due to economies of scale.

Schemes invariably need to be tailored to the specific requirements of each business, so independent financial advice in this area is important. We will be happy to assess your needs and to advise you upon the most suitable type of arrangement for your business.

Talk to a qualified Holborn Employee Benefits adviser today to find out more.