Group risk market resilient despite pandemic backdrop, says Swiss Re

It noted a ‘significant increase’ in discussion and reported usage of Employee Assistance Programmes and online GP services, as employees adjusted to their ‘increasingly digitalised daily lives’

The UK group risk market showed positive growth in 2020, demonstrating its “resilience and versatility” against a difficult backdrop, according to Swiss Re’s annual Group Watch report published today.

The 2021 report 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 closely with the 1.3% growth recorded in 2019, despite the advent and ongoing impact of the global pandemic.

It also found that the number of in-force death benefit policies increased by 4.1% and insured death benefits increased by 3.4%. The number of in-force LTDI policies increased by 0.9% and LTDI benefits per annum increased by 6.4% to over £100bn.

In addition, the number of in-force CI policies increased by 7.5% and in-force sums assured increased by 5.3%.

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.”

According to the report, the average membership per LDTI policy in 2020 was 155, up from 146 in 2019, which is the largest annual increase of the last five years. What is more, over 90% of those in force cover SMEs (250 members or fewer), a “positive indication” of the breadth and variety of businesses supported.

Swiss Re said the Group Watch 2021 report is based on “extensive market’ data, but also on the opinions of market experts, including 18 product providers and 20 employee benefits consultants.

It said several noted a “significant increase” in discussion and reported usage of Employee Assistance Programmes and online GP services, as employees adjusted to their “increasingly digitalised daily lives”.

Wheatcroft said: “What makes this year’s findings particularly notable is not only the positive growth in membership but our respondents’ praise for the way in which the market was able to adapt and execute its policies.

“Whether it be paying claims promptly, relaxing requirements for original paperwork or arranging deferrals to account for the financial impact of the pandemic, respondents were quick to highlight how accommodating providers have been.”

He concluded: “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.”

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