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Group risk insurance schemes can offer vital protection to the employees of small businesses. But more than that they can also help SMEs attract and retain the best talent. By offering access to insurances that may otherwise be unaffordable to staff, companies can make salary packages more attractive and competitive.

What is group risk, and is it for SMEs?

Group risk benefits pretty much do what they say on the tin. They provide benefits to a group of people, protecting them primarily against loss of income.

While employees are the beneficiaries of group risk schemes, policies are usually taken out by the employer who is responsible for paying the premiums and submitting any claims.

They can be quite flexible. Chase Templeton can, for example, advise small businesses how they can offer benefits universally or at targeted employees. Often group risk insurances form part of a wider employee benefits package.

Now that SMEs are bound by pension auto-enrolment rules, they may also look to add further value to their salary packages. With pension provision now standard, it’s important to stand out in the recruitment market and to nurture the loyalty of existing employees.

Insurers that offer group risk cover options for SMEs include Aviva, Legal & General and Unum.


 Which group risk products should small businesses consider?

Typically the term embraces three core types of insurance policy:

  • Group Life Assurance.
    • Also known as Death-in-Service, life assurance provides a tax-free lump sum to the beneficiaries named by an employee. Because it offers a high perceived value, it is valued by employees and because it is relatively low cost it is a good choice for SMEs.


  • Group Critical Illness
    • Critical insurance pays out a tax-free lump sum to an employee if they are diagnosed with a serious illness medical condition covered by the policy. Conditions commonly covered include many forms of Cancer, Alzheimer’s disease, strokes and heart attacks.


A group critical illness policy will not cover pre-existing medical conditions.  For those conditions which are listed on the policy, settlement of a claim may require your symptoms to be permanent and/or to have reached a level of severity. It goes without saying that as with any insurance you should check carefully what is and isn’t covered and any limits or restrictions that may apply.


  • Group Income Protection
    • Income protection provides a replacement monthly income to an employee should they be unable to work due to illness or injury. Benefits will usually be linked to an employee’s salary and be payable for a fixed term. Some policies also offer lump sums benefits at the beginning or end of that term.

More sophisticated schemes also include rehabilitation support to help speed an employee’s recovery – this clearly can help the employer by minimising the time they are off work.


If you own or manage an SME and would like to know the benefits group risk insurance could bring to your small business, why not call our specialist team on 01254 504910?