As millions of businesses around the UK feel the financial impact of their auto-enrolment pension contributions, ProtectMyPeople, the UK’s first price comparison website for group life insurance, cautions SMEs not to forget death-in-service cover for their employees.
Mike Preston, Business Development Director, says: “Auto-enrolment has had an impressive uptake but the increase also represents an opportunity for employers to consider cost-effective means to protect their employees.
“When the old company pensions were around, death-in-service was provided as part of a package. This meant that should an employee die before they reached retirement, they were provided with a lump sum – usually a multiple of their salary.
“HR directors and SME owners in charge of auto-enrolment provision may not realise that many off-the-shelf, basic auto-enrolment pensions don’t include death-in-service. Choosing to add it though is a valuable and simple addition to make.”
More than five million UK businesses* recently complied with their staging date for auto-enrolment, helping to protect their employees’ finances for the future when they retire. However, if no protection has been included for the present and they die before retirement, this can leave employees potentially vulnerable.
Usually cheaper than getting life insurance individually, group death-in-service cover is often more cost-effective for businesses than many might expect – for example, a firm of 20 individuals might expect to pay less than £7.00 per month per employee to provide a benefit of £50,000** each.
Preston added: “Most employers would not dispute the benefits of helping their staff save for retirement, but they should not forget the real value of including death-in-service to provide some protection for them should the worst happen.
“Death-in-service benefits give employees some peace of mind, providing a lump sum to their loved ones if they die while they are employed by the business.”
ProtectMyPeople provides quotes from leading life insurance companies, saving time and money. Visit http://www.protectmypeople.com for more.