Nearly 500 lump sum death benefits paid by employer-sponsored group life insurance policies
Statistics from Group Risk Development (GRiD) show that families of employees with group life benefits have been paid a total of £56,709,154 as a result of the pandemic between 1 January and 30 June this year.
This represents 475 lump sum death benefits claims, plus the capitalised value of seven 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, according to GRiD.
The average lump sum death benefit payment was £110,285 and the average capitalised value of the dependants' pensions was £617,771.
GRiD said that the average lump sum death benefit paid by group risk insurers would keep the family and dependants going for more than four years, based on the average pay in the UK of £504 a week.
Katharine Moxham, spokesperson for GRiD said: "These figures demonstrate exactly what our industry is here for. Group life is one of the unsung heroes of the employee benefits world, that is, until it's needed. Being supported in such a practical and tangible way, during one of the biggest challenges we've faced as a nation, will have been a great comfort to these families."
According to Swiss Re Group Watch 2020, group life assurance is the most popular group risk benefit that is offered to staff, provided to 9.7 million employees.
GRiD reported that the average time to notify an insurer of a Covid-19 related death claim was 22.4 days and the average time taken to pay the claim after that was 12.5 days.
Bill Leach, group risk manager for Zurich said: "The claims data published by GRID helps to highlight the valuable role of employer provided benefits like group life cover. The current pandemic has put protection products like this in the spotlight as we're seeing more claims that will ultimately help to provide some financial security to dependants and those left behind.
"Employers have an important role to play in supporting their employees and making them more financially resilient through relatively affordable group life arrangements that can be provided for on average £133 per person. Similarly, group income protection can also support employees affected by Illness, injury and disability with many benefiting from extra support like rehabilitation that can help with a speedier recovery and return to work."
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