Press release 22 February 2022.
One of the most popular employee benefits offered to employees is group life assurance*, with nearly 10million** employees covered by this benefit in the UK. Group life assurance makes a payment to an employee’s dependant(s) if the employee dies.
Figures released today show that for 2021 there was a significant increase (80%) in the amount paid out for COVID-19-related deaths compared with 2020, when £93m was paid***. This is an interim statement prior to publication of GRiD’s full group claims statistics for 2021 later this year.
COVID-19 related group life assurance claims paid 1 January to 31 December 2021
On behalf of GRiD, Gen Re has collected data from group life providers identifying COVID-19 claims paid across all of 2021.
For the period 1 January to 31 December 2021, the dependants of employees with group life benefits have received pay outs totalling over £168.3m after losing their loved ones as a result of COVID-19. This represents 1,578 lump sum death benefit claims, plus the capitalised value of 24 dependants’ pension claims where COVID-19 has been recorded as the primary or secondary cause of death on the death certificate or reported on the claim form.
The average lump sum death benefit payment for COVID-19 claims was £100,387 and the average capitalised value of the dependants’ pensions paid for COVID-19 deaths was £410,950.
Losing the income of a loved-one can be financially catastrophic for people, and the payment of a group life assurance benefit provides a vital financial lifeline for dependants. It is one of the most tangible and practical employee benefits that can be offered by companies.
In addition to the financial payments, dependants also often get access to other support embedded within these benefits, such as bereavement counselling and guidance on probate, so they help people through what is a very challenging time.
Katharine Moxham, spokesperson for GRiD said: ‘Employees are increasingly looking to their employers to help them through the challenges they’ve faced during the pandemic, and this is for all areas of health and wellbeing, including financial. The figures released today represent hundreds of families that have been supported because of an employee benefit, and we’d encourage more employers to offer this to staff.’
- Ends -
**Swiss Re, Group Watch 2021
***GRiD interim COVID-19 Claims Survey for 1 January to 31 December 2020
For further information please contact:
SMUK Marketing and PR
Mob: 07747 611773
Land: 01252 843350
Spokesperson for GRiD
Mob: 07887 512508
Notes for editors
About the COVID-19 claims data
This analysis involved the same ten insurers that have previously provided data for the 2020 and H1 2021 surveys. The insurers surveyed represent a comprehensive analysis of the whole market.
The data collected included the number and value of all claims paid under lump sum and death in service pension schemes between 1 January and 31 December 2021. Claims where COVID-19 is stated as the primary or secondary cause of death on the death certificate or reported on the claim form were reported as a subset of the total.
Given we are reporting claims paid and there is an average delay of 48 days between date of death and date of payment, this will capture deaths occurring between November 2020 and November 2021. The impact of the second and third waves throughout the winter of 2020/21 in the UK will be largely covered. However, the data will not capture the impact of the Omicron variant which became established in the UK population in December 2021.
The observed proportion of COVID-19 claims in the insured group life market is slightly lower than the COVID-19 claims proportion of 13% observed in the population between the ages of 20 and 65, according to ONS statistics.
Claims notification and payment
The weighted average time to notify the insurer of a COVID-19 related death claim was 46 days which is slightly quicker than the 48 days delay in reporting death claims for all causes.
The average period from the date of notification to the date of insurance payment was 17 days for COVID-19 related claims versus 19 days for all death claims during 2021.
Group Risk Development (GRiD) is the industry body for the group risk sector, promoting the value to UK businesses of providing financial protection for their staff, enhancing their wellbeing and improving employee engagement. Our membership includes insurers, reinsurers, intermediaries and those operating in (or with other interests in) the UK group risk market. Together this forms a collective wealth of experience built over many years. Under the chairmanship of Paul White (head of technical, Howden Employee Benefits & Wellbeing) GRiD aims to promote group risk through a collective voice to Government, policymakers, stakeholders and employers.
GRiD works with government departments and regulators involved in legislation and regulation affecting group risk benefits, and with other organisations involved in the benefits and financial protection arenas. GRiD also seeks to enhance the industry's standing by encouraging best practice and by participating in industry-wide initiatives such as the professional qualification in group risk managed jointly with the Chartered Insurance Institute.
GRiD’s media activity aims to generate a wider awareness and understanding of group risk products and their benefits for employers and employees.
GRiD's dedicated spokesperson, Katharine Moxham, provides expert media comment on a full range of group risk issues.
Follow Katharine Moxham on Twitter @KMoxham