Unum has launched a group income protection (group IP) product for companies preparing for pension auto-enrolment.
Designed with SMEs in mind, it provides an income of £1,000 a month if employees are off sick for more than six months.
It also provides an additional £150 a month to help fund employees' ongoing pension contributions.
This will help to reduce cost volatility and preserve pension contributions for absent staff, Unum said.
The policy can be put in place using the same data needed to auto-enrol employees into a pension scheme and requires no medical underwriting.
Employees will also have access to the Unum LifeWorks Employee Assistance Programme and vocational rehabilitation services.
Andrew Potterton, head of proposition development at Unum, said: "After pension auto-enrolment a pension will no longer differentiate employers, yet a competitive benefits package is vital to attract and retain staff.
"To stay competitive, employers should consider supporting their staff not only in retirement, but also when they are unable to work before reaching retirement age. Group IP can fill this gap and provide a financial back-up plan for the 1 in 10 people who go on long-term sick leave during their working lives."
