Group Income Protection insurance: trends and data

October 2024

In today's job market, where work incapacities are on the rise, employee benefits play a crucial role in retaining talent, attracting new employees, and supporting sick workers.

AG, with over 200 years of expertise, is a market leader in group insurance, covering pension, death, healthcare, and disability. Leveraging its position, especially in disability insurance, AG aims to transform available data to help employers position themselves effectively in the labor market.

AG’s Benchmark Study provides an in-depth analysis of the Group Income Protection and Waiver of Premium Insurance sector, focusing on contracts taken out with AG, which represent 45% of the market, and therefore accurately reflect the situation of companies with a head count of over 100 employees¹. The study examines the significance of income protection insurance, the legal replacement income in the event of incapacity to work, and the importance of supplementary income protection insurance.

1. Overestimation of social security protection and underestimation of the value of Income Protection Insurance

One of the key findings of this study is that the impact of income protection insurance is often underestimated. Many employees overestimate the level of financial support they would receive from the state in case of work incapacity, which can lead to significant financial hardship if they are unable to work for an extended period.

This misconception is particularly prevalent among higher earners who may not realize that state benefits are capped and may not cover their full salary.

2. Risk of falling ill

The study highlights that the risk of falling ill is higher than the risk of hospitalization or death. This finding underscores the importance of having comprehensive income protection insurance that covers a wide range of health issues, not just catastrophic events. Employees are more likely to experience periods of illness that prevent them from working, making income protection insurance a crucial safety net.

3. Influence of company size, sector, and salary

Company size, sector, and salary significantly influence the likelihood of having income protection coverage and the extent of coverage chosen by employers. Larger companies are more likely to offer comprehensive income protection plans, while smaller companies may have more limited offerings.

Certain sectors, such as Accounting & Audit or Pharma, tend to provide better coverage compared to others. Additionally, higher salaries often correlate with increased coverage options.

This variability highlights the need for tailored insurance solutions that consider the specific needs and characteristics of different companies and their employees. Employers in sectors with lower coverage rates should consider enhancing their benefits packages to remain competitive in the job market.

4. Coverage discrepancies

The study identifies surprising discrepancies in coverage, such as some employees having retirement/death benefit coverage but not waiver of premium coverage. This inconsistency can leave employees vulnerable if they are unable to work and cannot afford to continue paying their insurance premiums.

Employers need to ensure that their benefits packages are comprehensive and address all potential risks faced by their employees.

5. Holistic well-being approach

Financial coverage alone may not be sufficient; a holistic well-being approach can potentially reduce absenteeism. The study emphasizes the importance of addressing mental health and overall well-being to create a more resilient workforce.

Employees are increasingly looking for benefits that support their mental and physical health, and employers who offer such benefits are more likely to attract and retain talent. AG's initiatives, such as the reintegration program and Waldon prevention services, are examples of how employers can take a proactive approach to employee well-being.

AG has been at the forefront of developing innovative solutions to meet the evolving needs of employers and employees in the realm of income protection insurance. Recognizing that financial coverage alone can be insufficient,

AG's initiatives reflect a holistic approach to employee well-being, addressing both financial and mental health needs. By focusing on prevention, reintegration, and continuous support, AG aims to create a more resilient and productive workforce:

1. Return to work program

Pioneer in the market, AG integrated a reintegration program into its insurance coverage in 2017 to help employees with stress-related conditions returning to work safely and sustainably after a long period of incapacity for work.

2. Waldon prevention services

In 2019, AG launched Waldon prevention services, focusing on proactive measures to support employee well-being and prevent long-term sick leave. Waldon offers mental health support, stress management programs, and wellness initiatives, helping to create a healthier and more productive workforce.

3. My WellRi psychosocial risk auditing service

 Introduced in 2022, this service helps employers identify and mitigate psychosocial risks in the workplace. Developed in partnership with Waldon, My WellRi enables employers to create a safer and more supportive work environment.

4. Return to work dashboard

Launched in 2023, this dashboard helps employers track and monitor long-term sick leave cases, particularly stress-related conditions. It provides real-time data and insights, enabling timely and appropriate actions to facilitate employees' return to work.

These initiatives have had a significant impact on both employers and employees. For employers, the benefits include reduced absenteeism, higher employee retention, and a more engaged and productive workforce. For employees, the initiatives provide crucial support during periods of incapacity, helping them maintain their financial stability and mental well-being.

AG's proactive approach to employee well-being sets a benchmark for the industry, demonstrating the value of comprehensive and integrated benefits solutions. By continuously evolving its offerings to meet the changing needs of the workforce, AG helps employers create a supportive and resilient work environment that attracts and retains top talent.

AG’s Benchmark Study on Group Income Protection Insurance underscores the importance of comprehensive income protection coverage and a holistic approach to employee well-being.

Employers must recognize the limitations of state benefits and ensure that their benefits packages provide adequate financial protection for their employees. By addressing mental health and overall well-being, employers can create a more resilient workforce and reduce absenteeism.

Overall, the study provides valuable insights into the trends and best practices in the income protection insurance sector. Employers can use this information to make informed decisions about their benefits offerings and create a more supportive and resilient work environment for their employees.

Enhance your understanding of Group Income Protection insurance in Belgium and build a resilient, productive workforce with AG’s comprehensive benchmark study:

• Access detailed data on group corporate-sponsored plans, including participant figures, employer contributions, and sector classifications based on NACE codes.
• Gain sector-specific insights on how company size, sector, and salary impact income protection coverage, with breakdowns across 18 different sectors.
• Get expert recommendations to improve your benefits offerings and create a supportive, competitive work environment.

Don't miss this valuable resource! Click here to download the full study.