The benefit of benefits: Why smart SMEs offer death in service to their workers
5 min read
25 November 2018
More employees are moving jobs than ever before. So how do you make them stay? You create a better package, and this includes introducing a life insurance safety net.
A recent survey found that 1 in 7 SME workers were unhappy in their jobs. No wonder almost half of those surveyed said they’d be looking for a new role in the next 12 months.
So, what can be done to prevent a mass exodus of half of the UK’s SME workforce?
Common gripes for those unhappy in their jobs require cultural changes in the workplace to fix, from a lack of recognition for employees’ efforts to a poor support structure at work.
These are all bigger issues to tackle with discourse and a change in workplace attitudes and practises.
However, nearly a third of people were unhappy because of a lack of employee benefits, and benefits and perks were ranked sixth in a checklist of what employees thinking of jumping ship would be looking for from their next job. This is easier to solve.
Many SMEs might be labouring under the impression that employee benefits are something only larger companies can offer; however, there’s no reason why smaller businesses can’t provide such offerings, too.
Cheap… but makes employees cheerful
Death in Service – also known as Group Life Insurance – is typically the first employee benefit introduced by companies.
This is largely because it’s relatively inexpensive and simple, making it attractive as a first foray into the insurance market.
What’s more, premiums for Death in Service Cover are typically an allowable business expense for the company while not being a P11D or benefit in kind for your workers.
The general public is underinsured – according to another recent survey, less than half of UK workers had any form of Life Insurance to protect their loved ones should they pass away.
This leaves thousands of families vulnerable and is a huge reason behind the fact that employees value Death in Service so much.
More than you bargained for
Death in Service provides employees with more than just Life Insurance – most policies come with a range of additional benefits over and above the life cover itself.
The most common among these is an employee assistance program (EAP), offering various added extras for your workers.
This can be everything from telephone-based counselling or structured face-to-face counselling sessions with a medical professional to advice on legal matters and childcare.
Some of these benefits can nip problems in the bud before they come major issues, such as helping manage episodes of stress before they lead to significant periods of sickness absence.
EAPs sometimes also provide benefits for the business, giving line managers access to various HR resources to help them manage difficult situations at work.
Other benefits that come with these policies include:
• Grief counselling – for an employee’s bereaved family members
• Best doctors / second medical opinion service – provides access to a second medical opinion from an expert if the employee is diagnosed with a serious illness
• Probate services – another benefit for the bereaved family, this offers help and advice on the process of sorting out the deceased’s final affairs.
These additional extras are free and can help tip the scales when considering whether or not to introduce a particular cover on a cost/benefit ratio.
Why Death in Service?
“Death in Service Cover is the cheapest group protection insurance and usually comes with a multitude of additional benefits to maximise value for money for the employer,” says Nadeem Farid, Head of Employee Benefits at insurance intermediary Drewberry.
“What’s more, with penetration of Life Insurance so low amongst UK workers, having your workplace provide it for you is a massive bonus for employees.” – Nadeem Farid
“Overall, the benefit of benefits is that both parties win. Employee benefits have consistently been shown to help retain existing employees and attract new talent for the business.”
“Employers face lower staff turnover and thus reduced recruiting and training costs while acting to minimise the proportion of workers feeling undervalued at work.”
“Meanwhile, employees and their families get financial peace of mind, knowing they’re protected should the worst happen,” he continues.