Optima PA Business toolkit

Selling business personal accident insurance (PA) can be easy. This guide shows you how.

This document is intended only for use by authorised brokers of Ageas Insurance Limited and for their own internal business use.

About PA

The people working in a business are its most valuable asset and the temporary or permanent loss of a key person or a number of people can have a serious impact on the day to day running of the firm.  A report from the UK Commission for Employment and Skills found that in 2013, the value of employed human capital was estimated at £17.61 trillion – two and a half times the value of hard assets such as buildings, vehicles and machinery. In addition, in a survey of brokers by Ageas in 2015, 71% said most, if not all of the small businesses they dealt with would grind to a halt if the key owner/manager was not there to keep the business going. When considered alongside the fact that 28.2 million days were lost to work-related ill-health or injury in the past year (HSE 2013/2014), the protection offered by Personal Accident Insurance should be a serious consideration for SMEs.

What is personal accident insurance?

Personal accident insurance is a collection of benefits payable to employers or employees in the event of accident or illness that makes a person unable to work – it’s completely up to the employer how they want benefits to be paid.

It’s quite simple to arrange, incredibly flexible and costs as little as £25 a month. Benefits can be selected as required and are payable as either fixed sums or as a percentage of salary. All employees or just the employees who are critical to the business can be covered and businesses can select the time cover applies, the level of cover they want and the benefits to be insured. For example, while the most common cover is '24 hour', a business might only cover employees whilst they are working or commuting to and from work, offering premium savings.  

Temporary disability benefits can also be added that would pay regular monthly/weekly amounts for a set period – perhaps to cover absence due to a broken leg for example.

Every client can decide what is best for them based on their budget.  

Why buy business personal accident insurance?

  • A business would never consider trading without cover for their premises, stock or contents. How would they trade if they had no people to run the place?
  • The death or disablement of a key employee can be just as damaging to a business as a fire or a theft. Personal accident cover can provide benefits to pay for a temporary or replacement employee or cover overtime payments.
  • Accident or illness could mean real hardship for an employee and their family if they are unable to work. Personal accident cover can also provide benefits to ease this burden.
  • Many employers provide critical illness or permanent health insurance; personal accident can provide cover before those benefits kick in.
  • Cover applies for employees on a 24 hours worldwide basis if required or for whatever time the business wishes.
  • Claims are settled quickly as there is no need to prove negligence.
  • PA cover provides protection where other insurances don’t – for example, if an employee is killed in an accident that doesn't involve a third party.
  • It is a relatively affordable employee benefit that can assist in the recruitment and retention by forming part of a competitive remuneration package. 

Selling PA

Questions to pose to your Client

  • You probably have insurance cover for machinery, aren't the operators of this kit – your employees - just as critical to your business?
  • The longer you employ someone, the more valuable they become to your business – they are essentially an appreciating asset - what are you doing to protect that investment?
  • Have you considered how would you find the extra money to pay for recruitment costs and cover if an employee was off work due to an accident or illness?
  • Would your business cope with a loss of production, loss of sales or re-training costs if a member of staff was off work?
  • Could you afford specialist mobility equipment to allow an employee to return to the workplace if they were disabled as a result of an accident or a form of illness? 
  • Do employees travel together to work or on business trips? Could you deal with the sudden absence of a number of your key employees if there was an accident?
  • Are you heavily reliant on a number of key individuals? How would you manage if one of these key people had an accident or illness and was absent from work for a prolonged period?
  • Do you make normal salary payments when an employee is absent due to an accident or illness? Could you afford to take someone on to cover their absence?
  • Did you know basic personal accident cover can cost from under £25 a month and that the policy can be arranged to cover as many or as few employees as you choose with the same flexibility in the level of cover? 

Myths to explode and objections to overcome

  • PA cover is expensive – No, cover can start from less than £25 a month, that’s less than most people’s mobile phone bills.
  • It’s complicated to arrange – No, it’s actually very simple, the business just needs to confirm how many people they would like to cover and the level of benefit. 
  • If you have Health Insurance you don’t need PA cover – Wrong, PA cover is very different to Health Insurance – it is there to provide cash benefits to a business which can be used in the way they choose.
  • We already have life cover for death in service - Personal accident insurance can provide cover when an accident results in permanent disability.

Why sell business personal accident insurance from Ageas?

  • Our cover is designed for UK based SMEs with 2 – 300 employees. 
  • You can earn up to 20% commission.
  • We have a dedicated team to offer you expert advice, flexible underwriting solutions and help in showing your clients why the cover is important.
  • Totally flexible policy that we can help you tailor to your client's needs.
  • Basic cover from as little as £250 a year plus IPT.
  • Monthly instalments are available.
  • You can show how your client can protect their most valuable asset – their people!
  • Ageas's personal accident policy offers great benefits:
    • Death – up to £1,000,000;
    • Permanent total disablement – up to £1,000,000;
    • Paralysis – up to £1,000,000;
    • Loss of sight – up to £1,000,000;
    • Loss of limb – up to £1,000,000; and
    • Loss of speech – up to £1,000,000.

Cover

Demystifying the cover - what does that mean?

Cover     Meaning
Death     This benefit is payable if an insured person dies as a result of accidental bodily injury due to an insured event.
Permanent Total Disablement (PTD) This is payable following a severe accident that prevents an insured person from ever returning to their pre-accident usual job. (PTD usual). Sometimes the PTD is limited to the person not being able to do any job. (PTD Any)
Loss of limb, sight, speech or hearing  These effectively describe themselves. A benefit would become payable if an insured person should suffer an accident and lose an arm or permanently lose the use of an arm, for example. Similarly, the benefit would be payable should a person suffer an accident and lose their sight, their speech or their hearing. Collectively permanent total disablement (PTD), loss of limbs, sight etc are often referred to as 'capital' or 'caps' benefits as they result in the payment of a one off lump or capital sum.
Permanent Partial Disablement In addition to the death and caps benefits, some clients might want even more specific cover for the loss of fingers and toes. These are commonly called Permanent Partial Disability or 'Continental Scale' benefits. The 'continental scale' is quite standard and will indicate a percentage of the total compensation sum payable for the loss of a specific part of the body.
Temporary Total Disablement (TTD) This is a weekly benefit, payable when an insured person becomes unable to follow their usual occupation as a result of injury. TTD benefits are also available, as an extension of cover, for absence from work because of illness. Payments are normally made for a maximum benefit period of one or two years, and cover is often arranged under group policies for shorter benefit periods possibly 6, 9 or 12 months. Often these dovetail the personal accident and illness insurance with permanent health insurance arrangements.
Temporary Partial Disablement (TPD) This benefit would become payable when an insured person's injury does not completely prevent them from carrying out their usual occupation. The amount of benefit is usually a maximum of 40% of the TTD benefit. TTD is available for both accident and illness, but it is not common practice to offer cover for temporary partial disablement (TPD) as a result of illness. Quotations may be available depending upon the nature of the business and the level of benefit requested.


Policy limits

Policy limits are typically selected by the business to reflect the potential cost to replace an employee, compensate the individual or their dependants or to cover their weekly salary costs.

Benefits under a business policy can be related to salary, for example 4 x salary for death and Permanent Total Disablement (PTD) or a proportion of weekly pay for Temporary Total Disablement (TTD). A policy can also cover set amounts.

Ageas also offers business travel cover as an extension to our group personal accident product. It is also available as a stand-alone cover. For more information, contact our team on 0370 241 6182 or email us: patravel.underwriting@ageas.co.uk (Or see our Business Travel Toolkit)

Any one person limit

Normally, insurers will set a limit of maximum compensation for any one person during the period of insurance. Usually this is set at the level of the highest paid individual covered under the policy.

Aggregate policy limit

Insurers may also limit their exposure to certain accumulation exposures such as the number of insured people travelling on one aircraft or at one location. This is called the aggregate limit

Temporary Total Disability limits

The temporary total disability benefits (TTD) for both accident and illness are payable for the duration of any absence from the workplace. These can be payable for any number of weeks selected by the client. They are usually limited to a maximum of 52 weeks for illness and 104 weeks for accident events.

Deferment and excess periods

Like any other type of insurance, it is usual for an excess to apply. In the case of personal accident this is a deferment or excess period against the TTD and TPD benefits.
The deferment or excess period is the number of days at the start of any period of temporary disability where no benefit is payable.

What is the difference between a deferment period and an excess period?
A deferment does not 'use up' the benefit period at all. It just delays the start of the payments. An excess period is deducted from the benefit period.

Defrement table

Deferment or excess periods often vary according to occupation, age or for participation in certain sports or pastimes. Customers can choose a longer deferment period in return for premium reductions.

Persons to be insured

The insured business can decide who they want to buy cover for. It may be every employee or specific groups or even selected key individuals.  They can also select different benefits, different benefit amounts, different deferment periods and operative times of cover to apply to the different groups of insured persons. For example:

Occupation     Cover     Death and capital benefits  Temporary (weekly) benefits
Directors     24 hours 4 times annual salary 100% of gross weekly salary
Managers and office employees 24 hours 3 times annual salary 75% of gross weekly salary
Sales employees Occupational and commuting 4 times annual salary 75% of gross weekly salary
Warehouse employees Occupational accidents only 2 times annual salary 50% of gross weekly salary

Get a quote

The information required to produce a quotation will vary between insurers and the type of risk.
The following check list should be regarded as the minimum that will be required by us in order to assess each risk. 

The information we need to create a quote - check list

  • Full name and address of the proposer.
  • The nature of the proposer's business, describing this in full.
  • Past claims information.
  • The type and number of employees to be covered (i.e. sales people, clerical employees, manufacturing employees).
  • The level of benefits required for each group of employee.
  • The operative time of cover for each group (i.e. 24 hour, occupation only, etc).
  • Maximum individual earnings and the total wage roll per group if benefits are to be as multiples of salary.
  • Maximum number of employees travelling together at any one time.
  • Whether the people to be insured (employees) will make any contribution towards the insurance premiums.

Sometimes specific information about individual employees may be needed, such as past medical history. We will tell you if we need any specific information.

Ageas’s personal accident cover

Key points to remember before getting a quote:

UK based - The business/company taking out the policy must be based and registered in the UK. Typically this means that the employees will be UK resident although we will consider requests to cover some employees who might be based temporarily overseas.
Number of employees - We will typically insure SME risks with between 2-300 employees, but we will also consider larger or smaller companies too. 
Maximum Benefit - The maximum benefit we will provide for any one life is £1m.
Occupations - We will consider most occupation types. Clerical or light manual roles tend to return lower premiums than occupations with higher risks such as those in construction and manufacturing. 
Benefits - Typical benefit amounts for death and capital benefits should not exceed five times an employee's annual salary. 
Accumulation - 'General accumulation' is where more than one insured person is involved in the same loss. The maximum accumulation level we currently offer is £10m but typical accumulation limits for group covers for both aircraft and general accumulation are in the region of £5m.
Operative times - Most covers are arranged on a 24-hour basis.
Illness cover - Illness cover applies to temporary disability only and is only available with 24 hour personal accident cover.

What if the business has never had personal accident cover?

For new personal accident risks we will need information from a company's accident records for work related injuries and information from their record of absenteeism.

Call us on 0370 241 6182 or email us: patravel.underwriting@ageas.co.uk

How to get a quote?

Via Optima Online, our extranet facility, or call our Personal Accident Underwriting Team in London on 0370 241 6182. They can also be emailed to: patravel.underwriting@ageas.co.uk

Documents

Business Personal Accident and Illness

Questionnaires