Legal & General is launching a group CI policy to cash in on predicted growth in uptake of group products
Cover premiums can be paid direct by employees, rather than by the employer as is usually the case. But Legal & General points out that employees will get the benefits of a group arrangement through lower premiums and high levels of cover passed on without the need for a medical check.
Jane Dale, the company's group risk director, said: "Introducing a traditional group critical illness contract enables Legal & General to take advantage of a market which has the potential for substantial growth and gives us the opportunity to be more flexible in the market of the future."
Legal & General first entered the group critical illness cover market eight years ago with Group Health Crisis Cover. The company said Group Health Crisis is a hybrid of a critical illness and an income protection policy and the protection differs to the new policy both in terms of benefit provided and the taxation of both premiums and benefits.
Since the policy is classed by the Inland Revenue as a salary continuance scheme, employees are not taxed on the premiums paid by the employer as they do not represent a benefit in kind.
Dale added: "By offering both Group Critical Illness Cover and Group Health Crisis Cover, Legal & General is giving employers the opportunity to choose the contract which best suits their particular requirements."
Group Critical Illness Cover provides a lump sum payment for employees who suffer one of up to 27 insured conditions - normally after a 30-day survival period - and also covers an insured child or spouse.
The plan offers two protection options, with the core element providing cover for 10 insured conditions including heart attack, cancer, and also coronary artery
by-pass surgery.
The additional protection option extends the conditions included to 27, including permanent total disability, AIDS/HIV by blood transfusion, blindness, loss of hearing, loss of limbs, and major head trauma.
The contract is available for groups of 20 employees or more. Members benefit can be expressed as a multiple of scheme earnings or as a fixed amount. Where benefit is earnings-related, it will be subject to a maximum insured benefit of the lesser of four times scheme earnings and £100,000 - the maximum available.
