Nicola Culley asks if the introduction of auto-enrolment will deliver new business to the group life market or if employers burdened by the extra costs will cut back.
Many in the group sector worried the auto-enrolment cost burden would drive employers to chuck out core benefits. But early signs - now being the first phase of the roll-out with the larger companies - suggest a robust market with minor spurts of new business.
There are no hard and fast figures to support the theory that group life has benefited from the new pensions environment yet. But there is a lot to suggest employers are, at the very least, holding onto established group life schemes.
Group Risk Development (GRiD) figures from 2012 show 18.3% employers see group life as one of the main benefits to ensure wellbeing of staff and their families, compared with a lower 17.3% saying the same for group income protection and 12.4% for group critical illness.
According to GRiD, employer sentiment towards group life as a benefit increased on the whole from 2011 and 2012.
Last year, 37.8% of employers said they saw group life as an essential part of the core package, compared to 31.2% in 2011. And there was a small jump in those employers that saw the added value in group life with 14.3% in 2012 stating that the cost of the benefit could be recouped in improved staff morale, up from 12.9% the year before.
But as for post-auto-enrolment impact on group life, it is too early to gather statistics to tell the full story. And even if there were figures available, the initial roll-out has only happened for large companies. .
The first stage of the phased introduction of auto-enrolment of employees into company pension schemes took place for large companies in October 2012 with other businesses being phased in from now until 2018. It will be some time before the real impact of auto-enrolment on group life, and workplace benefits generally, can be seen
