As well as encouraging staff loyalty and demonstrating a genuine care for staff welfare, Employee Benefit provision goes some way to reassuring employees that their efforts in the workplace really count. The cost of Group Risk benefits to an employer can often be considerably less than the value attached to such benefits by the employees who enjoy them. Had the employees bought the equivalent cover as individuals, some may have found it quite expensive and others may even have been unable to get cover at all due to, for example, their age or an adverse medical history. Employers are able to purchase cover at far cheaper rates and acquire it for employers who might have to pay additional premiums or be declined for individual cover as a result of their medical history. Many employees will therefore value Group Risk benefits. Please note, some exclusions under a Group Scheme may apply.
Although they may not be at the top of all prospective employees’ consideration, Group Risk benefits are part of the overall package that will be weighed up when employees choose between different potential employers. Similarly, employees moving from one job to another will often want to be assured that the benefits they enjoy with the current employer will at least be matched by their next employer.
Group Risk is an umbrella term for three company sponsored employee benefits;
Group Risk benefits are often (but not always) fully insured to transfer the risk away from the employer to an Insurance Company. In general, Group Risk benefits receive favourable tax treatment both with regard to the employer who provides them and the employees who receive them.