New research carried out by PSHPC reveals that the cost of group life assurance (GLA), income protection (GIP) and critical illness cover (CIC) has actually fallen in real terms over the last 10 years for which figures are available.
The research shows that from 2003 to 2013, the average cost per employee of GLA and CIC has risen from around £100 to £125 and £175 respectively. CIC has increased significantly, but this is driven by increasing levels of benefit, as much as rising premiums. GIP, the most expensive of the three benefits, remains unchanged. At an average cost of £300 per employee, it is now no more expensive than it was back in 2003.
Commenting on the findings, Paul White, senior consult at PSHPC, says “When you factor into account that the Retail Price Index (RPI) has risen by 38% and median earnings have risen by 26%, the cost of all these benefits has actually fallen in real terms over the last ten years. “Compare this with corporate private medical insurance (PMI), where the average single subscription on corporate policies is in excess of £600, and suddenly risk benefits look positively inexpensive.”
The research also showed that the number of GLA and GIP schemes has fallen, but the number of lives insured has grown. For CIC, which is a much newer benefit, both the number of schemes and the number of lives insured have evidenced big growth.
