Group Life Assurance

Reassure your employees (and their families) with a Group Life Policy

Group Life Assurance

Life Assurance or Death in Service Insurance isn’t really a staff ‘perk’. It’s not really even about the money. But it is about reassurance. It’s also one of the easiest and cheapest benefit schemes to put in place.

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What is Group Life Assurance?

Life Assurance (also known as death-in-service insurance) pays a lump sum and/or a long-term income to an employee’s family if the employee dies while employed by your company.

You may be wondering what the difference is between ‘assurance’ and ‘insurance’? There are lots of definitions but ‘insurance’ generally means a claim or compensation for damage or loss. Whereas ‘assurance’ relates to an eventuality such as death.

It’s called ‘group’ (which we know sounds a bit jargonesque) because it’s an open-ended, umbrella policy that covers a group of people or employees.

“Group Life Assurance has free cover limits, so most employees can join without providing medical evidence. And claims are normally tax free.”

– Vikki Claxton, Life Assurance specialist

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How Group Life Assurance works

Unlike other types of life insurance, a group scheme is open-ended. So most employees can join the scheme without having to provide medical evidence.

We’ll do all the research to find you the most cost-effective policy and we’ll always try to source insurers that include bereavement counselling and probate helplines for the family too.

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Tax-free payout

Your employee’s family will receive a payout around three to four times the deceased employee’s salary.
No income tax implications

Although your business pays the premiums, Life Assurance isn’t classed as a benefit in kind. So your employees won’t be taxed on it.
Flexible policies

You can choose different levels of cover based on pay grade or seniority.
A Popular and Affordable Employee Benefit

Group life assurance is one of the most cost-effective benefits (and often the most valued) with many employees preferring cover of 3–4x their annual salary.
No Medical Underwriting Needed for Most Employees

Group life policies include a Free Cover Limit (FCL), allowing members to be covered up to a set amount without medical checks.

Many Group Life Policies Include Valuable Extras

While the main purpose of a group life policy is to provide a lump sum payment in the event of an employee’s death during service, many insurers now offer additional benefits that staff can access while they’re still living.

These extras are usually non-contractual and may change over time, but common complimentary features of a group life policy can include:

Exclusive savings and discount schemes
24/7 access to virtual GP services
Funeral concierge support
Financial and legal advice
Bereavement and probate assistance
Health and wellbeing resources

Why you should consider Group Life Assurance

Group Life Assurance is relatively cheap (compared to other employee benefits such as Group Health Insurance and Income Protection)
For many, a Death-in-Service Insurance payout will push them over the Pension Lifetime Allowance. But, by setting up a policy in the right way, we can ensure this doesn’t happen.
Group Life Assurance provides tax-free payouts, bereavement and probate advice and doesn’t require any underwriting.

*Based on analysis of data from Capita (by The Knowledge Academy )