Unum is launching a streamlined group income protection product offering a basic level of cover for companies preparing for pension auto-enrolment.
Aimed at SMEs, the new offering gives a flat benefit of £12,000 a year and an additional flat benefit of £1,800 a year to cover pension contributions. Income is paid if employees are off sick for more than six months.
No medical underwriting is required and Unum says a policy can be put in place using the same data needed to auto-enrol employees into a pension scheme.
The product also comes with access to the Unum LifeWorks employee assistance programme and vocational rehabilitation services, which provide ongoing support for employees and employers.
The announcement comes ahead of the next deadline for pension auto-enrolment on 1 May, when companies with 90-159 employees will be required to enrol staff on a company pension scheme. Research shows more than half of businesses with fewer than 250 people are using pension auto-enrolment as an opportunity to review their incentives.
Unum head of proposition development Andrew Potterton says: “After pension auto-enrolment a pension will no longer differentiate employers, yet a competitive benefits package is vital to attract and retain staff. To stay competitive, employers should consider supporting their staff not only in retirement, but also when they are unable to work before reaching retirement age. Group income protection can fill this gap and provide a financial back-up plan for the 1 in 10 people who go on long-term sick leave during their working lives.”