What happens when someone is off long term
A short absence is easy to absorb. A long one is harder. You may be paying sick pay, covering the work with overtime or agency staff, and wondering how long you can keep the role open. Your employee, meanwhile, is worried about money on top of their health.
Group income protection takes much of that pressure off. Once the waiting period ends, the insurer pays a proportion of the person's salary to you each month, and you pay it on through payroll. The employment relationship carries on, and you are not funding two salaries for one job.
Designing the scheme
You decide who is covered, how much salary to replace, how long the waiting period lasts and how long benefit can be paid for. A limited benefit period, such as a few years per claim, costs less. Cover until retirement age gives staff the fullest protection.
Many employers also cover the employer's pension contributions and National Insurance during a claim, so the employee's pension keeps growing while they are off. As with group life, most staff join without medical questions up to a free cover limit.
- Who is eligible and from when
- The share of salary the benefit replaces
- Waiting period, aligned with your sick pay policy
- Limited benefit period or cover to retirement age
- Whether to include pension contributions and employer National Insurance
Support that starts before a claim
Much of the value sits in the services around the policy. Most insurers offer early intervention, where a case manager gets involved once an absence looks likely to run on. They can arrange physiotherapy, counselling or a phased return plan, and advise you on reasonable adjustments.
Many schemes also include an employee assistance helpline, virtual GP appointments and mental health support for all staff, not just those off sick. Using these early often shortens an absence or stops it happening at all. Insurers differ a great deal here, so compare the services as well as the cost.
Fitting the scheme to your sick pay
Your sick pay policy and the scheme should work together. If you pay full salary for a set number of weeks, a waiting period that ends at the same point means pay never stops. A longer waiting period lowers the premium, though it leaves a gap if company sick pay runs out first.
Statutory sick pay still applies during the early weeks for eligible staff. Some employers trim company sick pay once a scheme is in place, while others keep it generous and choose a longer waiting period. Your employment contracts should reflect the approach you take, so check them with an HR adviser before the scheme starts.
How Hi Tomorrow helps employers with group income protection
We start with your sick pay policy, staff list and the kinds of absence you see. From there we suggest a waiting period and benefit design, then compare the insurers on our panel, including their definitions of incapacity and the support services they include.
We help you explain the benefit to staff and set up the processes your managers need to notify an absence early. When an employee does need to claim, we help with the paperwork and keep in touch with the insurer. Benefit paid to the company is normally taxable income for it, offset by the salary paid out, but your accountant should confirm how this works for you.