Unum introduces ‘foundation level’ income protection offering

Unum is introducing a new foundation level of income protection cover, designed to support the nine out of ten UK employees who do not currently have a financial back-up plan in place against long term illness or injury.

The product is designed to relieve the financial burden and stress from an employee and ensure that their essential outgoings, such as mortgage payments, bills and transport costs, can be paid whilst they recover.

The product aims to fill a gap in the lower income section of the market for employees who employers cannot afford to offer classic group income protection.

The new foundation level of income protection will offer up to 60 per cent replacement income with no offset for State benefits.

Unlike other products in the market which stop payment to everybody after a short period of two to five years, this foundation cover will continue to pay until retirement for those who need it the most – the 30 to 35 per cent of our claimants that cannot perform any suited activity and will never return to work.

Unum says exposure to its rehabilitation programme will ensure that the majority can return to their own occupation within two years.

Tom Dupuis, head of products at Unum UK, says: “In the current economic climate, employees value their benefits package far beyond its short-term monetary value. Income protection provided through the workplace extends the financial security of employees, meaning they have a back-up plan in place if they are unable to work due to illness or injury.

“Employers tell us that cost is often a barrier to offering income protection to all staff, so we’ve developed a low-cost option, which is still tax deductible. Budget-conscious employers can now cover their entire workforce, allowing employees to protect their essential outgoings and have access to professional and financial assistance to facilitate a return to work.”

For as little as £200 per year per employee, employers will be able to extend income protection to entire workforces, rather than solely their senior executives, where cover has historically resided.”