Almost half of employees would take income protection over a pay rise 

Employer-sponsored protection is featuring highly when it comes to staff preferences, alongside other features such as pension packages.


Employer-sponsored protection is featuring highly when it comes to staff preferences, alongside other features such as pension packages.

A study conducted by Group Risk Development (GRiD), the trade body for the group risk industry has concluded that over two in five employees (41 per cent) would pass up a pay rise of between 1 per cent and 3 per cent for employer-sponsored protection insurances. 

Of the employees interviewed, 44 per cent indicated that the benefit package offered by their employer made them feel valued, while 40 per cent said they were motivated to stay with a company that offered a positive range of benefits.

Pension packages ranked very highly with almost two-thirds of employees (65 per cent) putting them in their top three highest-valued benefits. On the other hand, income protection, life insurance and critical illness assistance are also highly valued with 56 per cent, 47 per cent and 41 per cent respectively putting them in their top three highest prized benefits.

Employer-sponsored benefits that provide a measure of protection are not preferred to the more traditional perks such as discounted gym membership (4 per cent), dental insurance (9 per cent), health screening (18 per cent) and even private medical insurance (35 per cent).

In spite of this, at present many people in the UK remain underinsured, according to Zurich’s Peter Hamilton. ‘Across the UK we remain hugely under-insured against the risks of being unable to work and provide financial support to our families in the event of illness. At the same time, we are seeing the cap in state benefits starting to take hold,’ he says.

The results from this study indicate a considerable change in what employees expect from employers and how employee’s attitudes have changed following the recent recession.

Though it is the considered opinion that the economy has turned the corner and shows encouraging signs of growth it is still in its infancy and has a long way to go to reach pre-recession levels. Job security still remains a major issue for employees and the availability of jobs that match or exceed current positions held continues to be problematical. 

A significant number of commentators maintain that economic uncertainty still persists and even though growth has returned for many workers their pay and conditions still lag behind prices and charges. As an indicator of this, recent studies show that home repossessions still remain at high levels in the UK.

Given the ongoing uncertainty in the job market, even those with cash in the bank must take stock of the risks of unemployment. The web site of income protection provider Endsleigh Insurance states, ‘Even those with savings are unlikely to be able to afford to live without an income indefinitely; particularly as state benefits are unlikely to ensure that your can maintain your standard of living.’

There is also the issue that many employers do not offer many of the benefits discussed earlier on to their employees, with the exception of pensions, and in small enterprises they may not be as attractive. This has prompted many people to seek various forms of protection for themselves in these uncertain times, usually from a private provider.

Hunter Ruthven

Hunter Ruthven

Hunter was the Editor for GrowthBusiness.co.uk from 2012 to 2014, before moving on to Caspian Media Ltd to be Editor of Real Business.

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