Is your employee protection cover ceasing too early?

The danger of non-compliance

Following the removal of the default retirement age (DRA), employee protection insurance benefits (group life assurance, group income protection and group critical illness cover) can legally cease at age 65 or the State Pension Age (SPA), whichever is later.

Group Risk Development (GRiD) has previously warned employers that they are ‘in danger of having group risk protection policies that are not legislatively compliant’ with the state pension age increase.1

However, we are still seeing policies where employers have kept a fixed cease age of 65, or in some cases age 60. In fact, research from a leading insurance provider reveals that:

  • 24% of their group life assurance policies;
  • 37% of their group income protection policies; and
  • 28% of their group critical illness policies

still have a cease age of 65 or less.2

What should employers do?

We would encourage all employers to review their current employee protection policies and redefine the cease date under the insurance as “greater of age 65 or SPA” to avoid a potential protection gap.

1 Group Risk Development (GRiD)
2 Canada Life Group Insurance



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