The UK group risk market demonstrated positive growth in 2020 reflecting its resilience and versatility against a difficult backdrop, according to Swiss Re’s annual Group Watch report.
The 2021 report, published today, reveals that the number of in-force group risk policies increased by 3.6% last year and that the number of people covered overall grew by over 150,000 (1.1%) to 13,317,249 by the end of 2020. This compares with 1.3% growth recorded in 2019.
The report also reveals the number of in-force death benefit policies increased by 4.1% and insured death benefits increased by 3.4%. The number of long-term disability income (LTDI) policies increased by 0.9% and LTDI benefits per annum increased by 6.4% to over £100bn along with the number of critical illness cover policies – up by 7.5%, while in-force sums assured increased by 5.3%.
According to the report, the average membership per LDTI policy in 2020 was 155, up from 146 in 2019 – the largest annual increase of the last five years, while more than 90% of those in force cover SMEs (250 members or fewer).
The report also gathered the opinions of market experts, including 18 product providers and 20 employee benefits consultants, with several indicating a significant increase in discussion and reported usage of employee assistance programmes and online GP services, as employees adjusted to increasingly digitalised daily lives.
Commenting on the report’s findings, Ron Wheatcroft, technical manager, L&H UKI, at Swiss Re and one of the joint-authors of Group Watch 2021, said: “In a challenging year for the global economy and for every individual touched by this pandemic, the group risk market proved remarkably resilient. Faced at first with widespread uncertainty and forced to adapt to a very different business environment, it responded with agility and was able to support even more employers, trustees and members than it did beforehand. To have achieved such growth in the context is no small feat.
“Whilst initial complications were to be expected as the world adjusted to a new normal, providers were ultimately able to demonstrate unprecedented flexibility, as well as delivering relevant guidance on mental health, diet, exercise and other central lifestyle factors for improved wellbeing.”
Also commenting on the findings, a spokesperson for industry body for the group risk sector GRiD, said the fact that the market has seen growth during the pandemic underlines the value that employers are placing on being able to support their workforce via group risk benefits.
“This support is not only financial: emotional and practical help is also available on a daily basis alongside a group risk product and these services have come to the fore.
“All group risk protection benefits really have come into their own over 2020 and throughout the Covid-19 pandemic. Not only has the entire industry reconfigured to working from home, but it’s been ‘business as usual’ as the industry has worked closely with employers to pay claims promptly and ensure they are still able to provide these valuable benefits in a way that works for how they’ve had to adapt their businesses during the pandemic.”