What does the group risk market look like post-pandemic?

group risk post-pandemic

Need to know:

The pandemic has focused minds on health and wellbeing, and fuelled growing interest in group risk products.
Employers are looking to extend cover to wider cohorts of employees.
Long Covid and the surrounding mental health and wellbeing challenges mean group risk products are becoming increasingly important.
To maximise these products, communication is key.

The Covid-19 (Coronavirus) pandemic has profoundly changed how many of us think about health and wellbeing.

Whether the impact of going down with the virus itself, the lingering effects of long Covid, or the harder-to-define challenges around mental wellbeing, the greatest public health crisis in a generation has forced everyone to reflect on health, fitness and even mortality.

Growing interest

It is perhaps not surprising, then, that the latest Group watch statistics from Swiss Re, published in April 2022, show growing interest in group risk insurance, such as life assurance, group income protection (GIP) and critical illness (CI) cover. The number of in-force group risk policies for 2021 increased by 4%, and the number of people covered by group risk policies through their employer rose by 6% year-on-year.

Katharine Moxham, spokesperson for group risk industry body Group Risk Development (Grid), says: “What Covid has done in terms of the group risk protection industry is to really bring home, both to employers and individuals, that actually we aren’t as indestructible as we thought. As a result, these benefits are really enjoying a lot of appreciation at the moment.

“People have been having to ask questions they haven’t had to ask before: 'What happens to me if I’m off sick for a long time? What happens to my family if I die?' Employers with these benefits are really able to provide reassurance."

Grid’s own research, published in April 2022, found that 43% of employers have changed how they communicate group risk benefits, with 60% increasing activity and more than half (53%) now placing more emphasis on their support for wellbeing, in particular.

David Williams, head of group risk at Towergate Health and Protection, agrees that there has been an uptick in interest, and an expansion in the use of group risk benefits as a result of the pandemic.

“Within our own book of business and also anecdotally over the last year to 18 months we’ve definitely seen all these policies increase," he explains. "We’ve seen a lot of new enquiries, especially from smaller businesses that hadn’t previously had cover. We’ve also seen employers wanting to add new members to existing policies. So, where [they] might have had policies only covering, say, monthly-paid staff, it is now being extended to weekly-paid staff."

Long-term and holistic

The ongoing impact of long Covid, both on individuals and their employers, has been a key catalyst for change in the group risk market, according to Steve Herbert, head of benefits strategy at Howden Employee Benefits and Wellbeing.

The latest figures from the Office for National Statistics (ONS) in April 2022, suggest that 784,000 people have been experiencing long Covid symptoms for at least a year, and as many as 74,000 for at least two years.

“These are huge numbers," Herbert says. "It is going to become a problem for employers in terms of absence and, obviously, for employees themselves who get it; it is not just months but probably years.

“In this context, GIP, with its free early intervention services and of course continuation of salary while somebody is off, becomes vastly important."

More insurers are introducing services or support specifically to manage the effects of long Covid, and there is greater awareness about the impact on health, mental and physical, from people being stuck on long NHS waiting lists. "Delays in diagnosis will obviously impact people in a negative way," says Moxham.

So how can benefits professionals maximise this opportunity? Enhancing communication is key, says Towergate’s Williams.

“It has moved on from the old-fashioned ‘let’s write a benefits guide and email it round as a pdf’," he explains. "It is now a lot more interactive, through Teams, Zoom, a benefits platform and apps on a phone.

“It is about ensuring [employers] are making the most of what [they] already have. It is important to be tracking usage, making sure a benefit is being used, making sure it’s a benefit valued by the staff. It is also about making sure [they] have got a really clear, joined-up strategy around all [their] benefits.”

Group risk products have always provided an important service as part of a wider benefits package, but as lessons from the pandemic settle in around health, wellbeing, and planning for unexpected challenges, this role is only going to become more integral.