Income protection policies that can help clients return to work sooner than they might have been able when ill or injured can have a positive impact for all parties. Benefits such as rehabilitation services, career counselling and proportionate benefits all aim to help clients get back into the workplace. In doing so the client gains, as they can become independent quicker, and the insurer gains as they can either pay a reduced benefit or stop benefits altogether. Getting a policyholder back to work quicker can also substantially reduce the impact of a significant illness on long-term career progression.
Not all insurers offer such benefits however, and where they are offered, insurers provide varying levels of comprehensiveness.
Rehabilitation services aim to aid a client’s recovery when they have suffered a debilitating injury or illness. The types of treatments offered include;
Occupational therapy – This provides an assessment and treatment to develop, recover, or maintain the daily living and work skills of people with a physical, mental, or cognitive disorder.
Physiotherapy – Physiotherapy aims to restore movement and function when someone is affected by injury, illness or disability.
Complimentary therapies – Complimentary therapies are used alongside prescribed medical treatments to help people with severe illnesses or injuries feel better and improve quality of life.
Of the insurers that provide rehabilitation services, all give their clients access to these services, however, there are other aspects that differentiate the propositions available in the market.
One example of this is when a client can access the services. Some providers offer rehabilitation services at any point in the policy’s lifespan, whilst the others restrict access to the point of claim.
Offering the benefit at any point of the policy’s lifespan will mean clients that are suffering from an injury or illness – that might not be severe enough for a claim – would still be able to benefit. This in turn could help ensure that the condition does not progress to a point where they need to make a claim and as such be used as a preventative benefit as well as an aid to recovery.
The other main difference between insurers is how much they are willing to pay towards rehabilitation services. Most providers do not have a limit to rehabilitation services with the exceptions of Vitality and Zurich.
If the injury or illness the client has sustained means that – even after rehabilitation – the client is unable to return to their previous occupation but is able to work, finding an alternative career path to take can be daunting.
To help claimants, some providers offer career support services. These aim to help clients get back into the workplace by offering; job market research, CV writing and interview preparation services. The graph below shows how career support can be accessed from different insurers.
Like rehabilitation services, the costs for obtaining the best career support services may not be cheap. It is therefore preferable if the insurer is willing to cover the full costs of the services used, notably Aviva, LV= and Royal London provide no such restriction, which is attractive.
Whilst both rehabilitation benefit and career support services are designed to help the client in returning to work, in some cases the client’s injury or illness may prevent them from being able to earn the same amount as they did pre-incapacity.
In such cases insurers may pay a reduced ‘proportionate’ benefit. The reduced benefit will largely be calculated based on the percentage decrease in the client’s salary when compared to their pre-incapacity earnings.
If a client has been incapacitated for a long period of time before returning to work in a reduced role or occupation where they earn less, the chances are that inflation will have eroded the actual buying power of their income. To combat this, some providers, when calculating the proportionate benefit, will take into account the increases in RPI from the start of incapacity to the client’s return to some form of work.
In summary, back to work benefits are an important element of Income Protection policies for advisers to consider. Our analysis highlights Aviva and Royal London as particularly strong in this area. They offer rehabilitation benefits throughout the term of their policies, with no limit on the costs they will cover. They also cover the full cost of the career support services they provide which can be accessed through all the main channels. In addition, they offer proportionate benefits to clients, taking RPI into account in their benefit calculations.
Key points to consider:
• Insurers offer various back to work benefits to help clients get back into work
• Not all providers offer to cover the full cost of these benefits
• Some providers allow access to back to work benefits throughout the term of the policy while others will only provide them after a claim
• The effect of inflation on the amount of proportionate benefit providers pay can be significant. Preference should be shown to those who take RPI into account in their calculations.