Positive growth for UK group risk market, says Swiss Re

The UK group risk market has “raised its game” and continued to show positive growth last year, according to Swiss Re’s annual Group Watch report. It also reveals a much greater engagement with support services such as employee assistance programmes (EAPs) and virtual GPs in the UK. Swiss Re says the UK group risk market has proved resilient in the face of sustained economic and market uncertainty, with the number of in-force group risk policies increasing by 4.1% from 81,055 in 2020 to 84,369 in 2021. And the number of people insured rose from 13,317,249 by the end of 2020 to 14,106,854 by the end of 2021 – a 5.9% rise compared to just 1.1% growth in the preceding year. Ron Wheatcroft, technical manager, L&H UKI at Swiss Re, and one of the joint authors of Group Watch 2022, said: “These are very encouraging numbers given that, for much of 2021, there were few signs of the certainty that employers and insurers craved. The data show more positive market performance with increased coverage across all three policy lines (death benefits, long-term disability income and critical illness). Above all, they reflect a mood of confidence that the market has raised its game over the past two years – and also one of optimism that it is well placed to show its value in future.” The report shows that the number of in-force death benefit policies increased by 3.7% and insured death benefits increased by 5.9%, while membership of non-pension excepted group life policies increased by 42.2%. The number of in-force long-term disability income policies increased by 4.3%, and the number of people insured increased by 4.6%. In-force benefit amounts grew by 6.0% and premiums by 8.6%. And the report shows that the number of in-force critical illness cover policies increased by 8.2% and in-force sums assured increased by 10.4%. Swiss Re points out that one notable theme from the report is the greater usage of services, primarily driven by EAPs and the enormous growth in services offering virtual GPs. Respondents to the report, including individuals at both employee benefit consultants and product providers, referred to this increase, says Swiss Re, with employers showing keenness to promote these benefits and take more time to understand how they work, as well as their importance as part of a well-rounded proposition. “The level of engagement with support services this year is particularly pleasing, especially the take-up and usage of EAPs,” Wheatcroft said. “This goes to show that these products are no longer viewed merely as ‘nice-to-have’ add-ons, but rather as core features within a much wider proposition that employees genuinely value.” He added: “While the UK appears to be better placed in managing the impact of the pandemic, the effect of long Covid on our health systems, the private health sector, employers and employees remains uncertain, and there is always the possibility of further variants. We also cannot ignore the fact the economy is frail, with rising inflation and a growing cost-of-living crisis.” Wheatcroft said more needs to be done to support businesses large and small in accessing the market and adapting to the ‘new normal’. “With just 84,369 policies in force at the end of 2021, it needs both the effort from our industry as well as government support to make product models simpler as businesses struggle against economic headwinds,” he said. “Particularly given the complexity that the freezing of the lifetime allowance until 2026 adds for group life cover, we persist in calling for an exemption from entry, periodic and exit charges for trusts holding as a sole asset all pure protection policies, including excepted group life and relevant life policies,” said Wheatcroft.

Positive growth for UK group risk market, says Swiss Re

Greater use of support services such as employee assistance programmes

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