Employees opt for Income Protection Over Pay Rises | Prepaid365

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4 February 2014
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The latest research suggests it’s not all about money for many employees, as benefits such as income and health insurance appear prominently on their agendas.

According to Group Risk Development (GRiD), more than two in five employees suggested they would forego a pay rise of between 1% and 3% for employer-sponsored protection.

The trade body for the group risk industry said 41% of people questioned wanted Group Life Insurance and Group Income Protection ahead of a potential pay rise.

It highlights the importance of benefits packages for many staff, with 44% saying it made them feel valued within a company.

An additional 40% also said they were more likely to stay with an employer in the long term if a good range of benefits was offered.

The importance of income protection

Income protection is important as it can provide cover in instances where it is not possible to work for a prolonged period of time.

A lack of income can place additional pressure on finances, making financial management a vital part of dealing with any potential issues that may arise.

Prepaid cards can assist with this, as only money available on any specific card can be spent, meaning overspending is not possible without making an effort to top up funds.

Pensions ranked highest in the list of the benefits which employees value most, although Income Protection, Life Insurance and Critical Illness benefits also featured high on the list.

Covering regular bills can be difficult if income is limited for any reason, so Income Protection can help in the form of tax-free income should health issues prevent someone from working.

“Through the provision of Group Risk protection products, employers play a vital role in ensuring that staff and their families are adequately protected from the financial devastation that death or disability can bring,” explained Katharine Moxham, spokesperson for GRiD.

Working with the statistics

Something to consider is that people are more likely to suffer an illness that prevents them from working than they are to die during their working life.

Statistically, there is a one in 12 chance of the latter, compared to a one in five chance of being off work for more than three months as a result of serious injury.

In the past, the state covered such issues with generous packages, but sets of stringent cuts now mean living on a support allowance is not enough to sustain a lifestyle, following years of continual abuse of the system.

The policies are put in place to reduce the risks involved but each individual policy will vary, making it important to get the right type of policy.

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