New data has revealed the extent to which group life insurers have paid out claims related to the deaths of employees due to Covid-19 (Coronavirus).
According to figures released by Group Risk Development (Grid) for the year to 31 December 2020, payouts were given to the dependents of 891 employees with group life benefits who died due to Coronavirus.
The total cost of these payments, where primary or secondary cause of death was registered as Coronavirus, came to £93 million – representing an average lump sum death benefit payment of £100,320, with the average capitalised value of the dependants’ pensions being £617,771.
But according to Grid, the real number of payments is likely to be nearer 1,000 (or around 14% higher), as there is typically a delay between the date of death and date of payment.
Moreover, Grid believes the figures for 2021 could be even higher still, as the impact of the second wave of deaths throughout the winter of 2020 in the UK were not fully captured by the current published figures.
With data by the Office for National Statistics showing there were 7,961 deaths among people of working age attributable to Coronavirus between 9 March and 28 December 2020, it means the group risk industry supported around one in nine (11%) of these grieving families.
Commenting on the data Katharine Moxham, spokesperson for Grid, said: “Employer-sponsored group life insurance products are the most popular group risk employee benefit in terms of take-up, but they are often considered a hygiene factor.”
She added: “What these figures show, however, is compelling evidence that group life insurance should remain core to all employee benefits packages. It provides significant financial support for dependents at an extremely difficult time.”
Unfortunately, Grid revealed that it was highly likely that the majority of the families of people who died from Coronavirus did not receive any death benefit payment at all.
Moxham added: “The group risk industry has, and will, continue to provide support to the loved ones of deceased employees throughout this crisis. We hope that publicising these figures means their value can be better understood by employers and their staff.”