Growing Your Business with Unum s new Income Made Protection To Measure cover - A Guide for Advisers

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1 unum.co.uk Growing Your Business with Unum s new Income Made Protection To Measure cover - A Guide for Advisers Group Income Protection Plans Cover To for what s Suit really All needed Businesses - a foundation level for essential financial outgoings. Supports your clients businesses - more than just a benefits payment for ill or injured employees. Because everyone A cost-effective solution that brings Income needs Protection a back-up within plan reach of all employee benefits budgets. Because everyone needs a back-up plan

2 5 REASONS FOR EMPLOYERS TO OFFER INCOME PROTECTION 1 3 C A N K E E P MORALE H I G H C O V E R S T H E C O S T OF SICKNESS ABSENCE 2 HELPS REDUCE THE LENGTH OF SICKNESS ABSENCE 5 SO YOU CAN FOCUS ON RUNNING YOUR BUSINESS HELPS YOU UNDERSTAND YOUR LEGAL COMMITMENTS MANAGES THE ABSENCE FOR YOU 4 1 Provides a level of income for your employee so you don t have to. 2 Our rehabilitation 3 Employees are reassured 4 We ll stay in touch with 5 programme can help get that they will be looked all parties, including GPs, employees back to work after if they are ill to keep your employee on before you know it. or injured. track and you up to date. We'll let you know if reasonable adjustments have to be made to the workplace to uphold your duty of care. 2

3 Why Income Protection? In uncertain times, people need the reassurance that if the worst happens, they have a back-up plan to protect themselves and their loved ones. Income Protection can pay up to 80% of a person s salary if long-term illness or injury strikes, giving financial peace of mind until they can return to work or if they can t, continues to provide a financial safety net right up until retirement. Employers benefit too. Our vocational rehabilitation experts will help your employee return to work as soon as they are able. At the same time, our claims management team take much of the burden of absence management off your shoulders - allowing you to get on with running your business. Plus access to comprehensive knowledge in employment law steers you through the legal minefield of employment and disability legislation. Simply, Income Protection reflects people s lives today and the risks they face, yet just 1 in 10 UK workers have the peace of mind that Income Protection offers. 3

4 ??? The myths around Income Protection The Myth: It will tie me to my employees for longer than I want. The Truth: It won t. We relieve the burden with the option to pay your employees direct, allowing you both to move forward once your Duty of Care obligations are met. The Myth: My employees don t value it. The Truth: The chances are they re not even aware of it, may not understand it or believe they ll get by. We can help you protect your employees, giving both them and you peace of mind. The Myth: Even if they did value it, I can t afford it. The Truth: We believe every employee deserves a back-up plan to help them through the financial trauma of long-term injury or illness. Unum s wide range of Income Protection cover offers affordable plans to suit every business and budget. 4

5 Fit for purpose - a plan to suit Our core range of Income Protection plans are designed to be flexible and complement each other, providing you with the perfect protection to suit your needs. Classic Foundation Unum Select You may prefer to offer a lifestyle level of cover to attract and retain your most senior, highly valued employees as part of your talent management strategy. Or you may want a basic level back-up plan to protect all your valued staff if the worst happens, a plan that allows you to share the cost, or even a combination to suit your varied business needs. We will work with you to find you the right protection for your particular needs. Our wide range of flexible product plans and features can be tailored to suit all budgets. All our Income Protection policies come with a built-in Employee and Employer Assistance Programme, allowing you to get on with running your business and providing day-to-day support and guidance to your staff. 5

6 The three pillars of Income Protection Plan Classic Foundation Unum Select Type of cover Lifestyle cover Essential cover Essential level of cover Shares the financial load between employer and employee Cover explained Most widely offered in the market today with wide range of scheme design choices Includes lifestyle cover, typically offered to senior employees Pay Direct optional Back-up plan for all staff to cover life s essentials - such as mortgage, rent, utilities A Pay Direct policy which pays an income to the incapacitated employee direct, even if they leave employment Flexible funding option for employers who want to offer benefits but need to share the cost with employees Pay Direct for employee contributions Typical characteristics Typically employers who are looking to provide more comprehensive lifestyle cover Aim to meet the industry benchmark Tool to recruit and retain key staff Expect to fund benefits themselves Employers who like to be seen as considerate employers but the needs of the company come first in the current economy Basic cover needed to be on a par with competitors Cost-effectiveness is key Expect to fund benefits themselves Employers who value choice for employees. Companies can set the level of employer and employee spend to suit themselves Protection is desirable but total funding is beyond the reach of the firm s budget Funded by employer and employee at a level set by the employer 6

7 State Pension Age Classic and Foundation Income Protection can be linked to State Pension Age (SPA) - helping you to better meet your obligations in providing Group Income Protection for employees up to the SPA. With cover to SPA, you can relax knowing that employees who cannot return to work will benefit from financial support for the whole of their working life. For more information, please refer to our Guide to the Changes to State Pension Age. In addition to our core offerings, we also provide an industry-leading selection of specialist plans to meet specific needs, including: Dual Benefit Ideal for small businesses, protecting both the absent employee and the business from disruption. Benefits can be paid after just 4 weeks, while additional finance helps the business cover costs such as recruiting temporary or replacement staff or paying for overtime. Capital Option Includes a lump sum if the employee remains incapacitated after a set period to help fund early retirement. Protecting the protection People are now 3 times more likely to suffer a long-term illness or injury than die during their working life*, yet 90% of UK private sector workers have no Income Protection against the devastating financial consequences of long-term illness or injury. People are more likely to insure their mobile phone or their pets than their income, but without an income, pet and phone insurance is an unaffordable luxury. Income Protection can cover all of life s expenses. * source: ONS 2008 % Claimed ownership All insurance products And all Unum s Income Protection plans come with our built-in Employer and Employee Assistance Programmes Unum LifeWorks at no extra cost. Supporting staff and managers every day even before absence becomes the only option. ANNUAL TRAVEL INSURANCE PET INSURANCE MOBILE PHONE INSURANCE INCOME PROTECTION 8% 14% 13% 23% Source: IPSOS Mori/GMI/Mintel/Unum Source: IPSOS Mori/GMI/Mintel/Unum 7

8 Group Income Protection - Employer Benefits More than just offering peace of mind, Group Income Protection offers: A replacement income to honour your contractual promise to your employees. Our experts working for you, listening, managing and supporting your people back to work where possible. Giving you legal expertise on the phone and online, saving you s. Access to tools to manage sickness absence and help retain valuable skills and knowledge. Online and telephone support for your managers, saving their time and reducing the risks associated with absence management. Pay Direct option continues financial support even when the employment relationship ends. 8 Enhanced employee benefit packages aiding employee retention and recruitment.

9 Group Income Protection - Employee Benefits Group Income Protection through an employer offers: 2 3 Financial support up to a maximum of 80% of pre-illness salary until a return to work or retirement. Our experts listening, understanding and managing a successful return to health and work where possible. Affordability - could cost an employee up to two-thirds more if bought outside the company. Accessibility a level of cover for all eligible employees who are Actively at Work on joining the scheme, regardless of any existing incapacities. Employee Assistance Programme - everyday help both before and after absence has become the only option. 9

10 Examples of typical plan outlines Classic Foundation Unum Select Basic Benefit 75% Salary 60% Salary 3,000 per year Maximum Annual Benefit Per Member 350, ,000 36,000 Definition of Incapacity 1 Insured Occupation (Definition A) Combined Occupation (Definition B) 2 Current Occupation (Definition A) Escalation Rate 1 CPI Max 2.5% Nil Nil Deferred Period 1 26 weeks 26 weeks 26 weeks Benefit Period 1 To State Pension Age (SPA) To State Pension Age (SPA) Age 65 or 70 Average Annual Premium per employee Funded by Employer Employer Shared by Employer and Employee Note: This is an illustration only; costs will differ for companies with different demographics and benefits. 1 Other options available upon request 2 2 years Insured Occupation followed by Gainful Occupation 3 75 paid by Employer and 75 paid by Employee 10

11 About Unum Unum are possibly the biggest insurer you and your staff have never heard of, but we re number one in the Group Income Protection market*, offering peace of mind for more than 40 years. We are using our experience and expertise to bring the issues around Income Protection into the open. Our innovative TV and media campaign has raised awareness among employers and employees alike and people throughout the UK are talking about the need for a back-up plan. Contact your Financial Adviser today and find out more about the wide range of flexible Income Protection options available to suit all businesses or visit (Source: Swiss Re Group Watch 2011) * in terms of premiums 11

12 Financial Protection Unum specialises in forward-thinking, imaginative financial protection benefits (Income Protection, Life cover and Critical Illness cover). We work with advisers and their clients to deliver solutions that make these invaluable benefits accessible to all UK employees. Financial protection benefits are essential when you need them and provide peace of mind when you don t. They provide crucial financial support to employees and their families in the unfortunate event that they can t work or earn an income. And companies that offer them can create a more motivated and engaged workforce, achieving a sustainable competitive edge in today s challenging business environment. Income Protection Critical Illness Life Cover Registered office: Milton Court Dorking Surrey RH4 3LZ Unum Limited is authorised and regulated by the Financial Services Authority. Registered in England We monitor telephone conversations and communications from time to time for the purposes of training and in the interests of continually improving the quality of service we provide. Copyright Unum Limited 2012 Tel: Fax: UP /2012 Page 12 of 12 unum.co.uk