Product updates

As you’d expect, we’re always looking for ways to improve our Group Risk products. If changes have been made to features and benefits, or documentation has been updated after publication of printed material, you’ll find those details on this page.

April 2012 - Changes to Life Time Allowance (LTA)

Why is LTA changing?

On 9 December 2010, the UK coalition government approved a number of the proposals within the Finance Bill as part of its strategy to "restore the UK tax system's reputation for predictability, stability and simplicity". From 6 April 2012 an individual's LTA has been reduced from £1.8 million to £1.5 million.

  • LTA is the total capital value of all an individual's registered pension arrangements (excluding any State paid pension) which they can build up without being subject to an LTA charge, currently 55% on the excess.
  • From 6 April 2012 an individual's LTA has been reduced from £1.8 million to £1.5 million.

What do these changes mean?

As registered Group Life lump sum policies are currently treated by Her Majesty's Revenue & Customs (HMRC) as a Registered Occupational Pension, these benefits count towards an employee's LTA. More people are likely to find their combined benefits exceeding LTA as a result; therefore, employers may need to reassess how their group life benefits are structured.

Who is affected?

HMRC state that to be affected an individual:

  • needs to have saved more than £1.5 million in money purchase pension schemes, or
  • be a member of a final salary scheme who is entitled to a pension of either
    • £75,000 pa, or
    • If a scheme pays out a separate lump sum (typically three times the value of the annual pension), a pension of around £65,000 pa

If an individual meets these criteria they can apply to HMRC for protection before 6 April 2012 to guard benefits up to the current limit of £1.8 million as long as they meet a number of conditions laid out by HMRC. This will effectively 'ring-fence' existing benefits, even if they exceed the new LTA (£1.5million).

What is Aviva's Group Risk position?

Steve Bridger, Head of Group Risk at Aviva, says that "certain individuals who are covered by a policy for lump sum benefits up to a maximum of the current LTA may need to look at their existing benefit arrangements.

At Aviva we are more than happy to work with advisers and their clients in looking at these arrangements. It's important to note that where a client holds an excepted policy, these benefits do not count towards the LTA".

  • It is important to check all existing benefits - Aviva Group Risk are happy to help with any questions you may have
  • Anyone holding an Aviva Relevant Single Life or Excepted policy will be protected as these types of policies are not treated as a Registered Occupational Pension by HMRC

Want to know more?

If you'd like more information on what we can do for you and your clients, call you usual contact or our Group Risk Sales Support Team on 0845 300 4452*

Lines are open from 9.00am - 5.00pm, Monday to Friday
Calls to and from Aviva may be monitored and/or recorded.

Registered details

Aviva Health UK Limited. Registered in England Number 2464270. Registered Office 8 Surrey Street Norwich NR1 3NG.
Aviva Health UK Limited is authorised and regulated by the Financial Services Authority. FSA Registration No 308139.

April 2012 - Changes to contracted- out National Insurance Contributions (NIC)

What is changing?

From the 6 April 2012, the Government will be abolishing the option to contract out of the additional State Pension, commonly known as the State Second Pension, on a defined contribution basis.

The result of this will mean that employees will no longer be able to use a contracted-out money purchase (COMP) occupational pension scheme to contract out. And both the employer and employee will revert to standard rate contracted-in NIC. This employer rate is currently set at 13.8% which is 1.4% above the contracted-out rate.

Aviva Position

For all policies where we currently provide cover on a COMP basis, we will automatically increase cover to provide standard rate contracted-in NIC from the 6 April 2012.

Existing Policies costed on total salary

There will be no change to policies within the rate guarantee period, or to the annual premium. Any change in premium to reflect the increased NIC rate will be calculated once the policy goes through rate review on or after the 6 April 2012.

Existing Policies costed on total benefit

This will ordinarily apply to all single premium rated policies and unit rated policies costed as a percentage of benefit. By applying the additional NIC rate to the benefit level there will be an increase to the individual member benefit level which will be reflected in the premium rate at the policy anniversary.

Claims

Where a member is either;

  • Being paid benefit as a claimant, or;
  • Is incapacitated and still in the deferred period

We will apply the NIC rate applicable from the date the member was first absent prior to the 6 April 2012.

Want to know more?

If you'd like more information on what we can do for you and your clients, call our Group Risk Sales Support Team on 0845 300 4452*

Lines are open from 9.00am - 5.00pm, Monday to Friday
Calls to and from Aviva may be monitored and/or recorded.

Registered details

Aviva Health UK Limited. Registered in England Number 2464270. Registered Office 8 Surrey Street Norwich NR1 3NG.
Aviva Health UK Limited is authorised and regulated by the Financial Services Authority. FSA Registration No 308139.

Aviva Health UK Limited, Head Office: Chilworth House Hampshire Corporate Park Templars Way Eastleigh Hampshire SO53 3RY. www.aviva.co.uk/health-insurance

September 2011 - First to launch online claims for Group Life

From 1st September 2011 we're proud to announce the launch of our online Group Life claims process, which automatically checks the Government's Death Register to verify a claim, meaning we no longer need a copy of the original death certificate*.

What does this mean for your clients?

  • They can go online and make their claim in just six simple steps
  • There's no need to submit the original death certificate*, which is needed for numerous other claims and notifications following a death, so they don't have to prioritise its usage and wait to submit their application
  • They don't have to worry about delayed post or lost documents
  • There's no need for clients to complete page after page of claims forms
  • The process of the payment will be faster

The result:

Clients have quicker, easier access to crucial funds at what is a difficult time, giving them one less thing to worry about. Find out more

* In certain situations the original certificate may still be required. For example, in the event of a death abroad, or a claimant submitting a claim early, prior to the death being logged on the government register. Also if an interim death certificate had been issued, we would need the original.

June 2011 - Default Retirement Age (DRA) - Helping you and your clients meet their current legal obligations

With the Government phasing out the Default Retirement Age (DRA) and an exemption granted for insured Group Risk benefits by the Employment Equality Regulations 2011, we'd like to make sure that your clients are reassured, and understand the impact.

What does this mean for you and your clients?

Regardless of what changes are still being considered by the Government, you need to be aware of the dates proposed so that you can explain the potential impact to your clients.

  • Cover will no longer be based around a 'normal retirement age'; instead we will simply provide cover to an agreed termination age.
  • Levels of cover may vary by category but should not vary based upon age.
  • Clients need reassurance that policies using the State Pension Age (SPA) to determine the termination date of risk and benefit payments can accommodate the changes in legislation.

If you require further information on the changes to the SPA, then please download our Sales Aid or contact our Group Risk Sales Support Team on 0845 300 4452.

Lines are open from 9am - 5pm Monday to Friday. Calls to and from Aviva may be monitored and / or recorded.

To find out when your client's will reach the State Pension Age, find the period in which their birthday falls in the left-hand column and read the date of retirement in the right-hand column.

Please note, this only covers the changes to increase SPA above age 65.

Current Legislation
Period within which birthday falls Day pensionable age attained
6th April 1959 to 5th May 1959 6th May 2024
6th May 1959 to 5th June 1959 6th July 2024
6th June 1959 to 5th July 1959 6th September 2024
6th July 1959 to 5th August 1959 6th November 2024
6th August 1959 to 5th September 1959 6th January 2025
6th September 1959 to 5th October 1959 6th March 2025
6th October 1959 to 5th November 1959 6th May 2025
6th November 1959 to 5th December 1959 6th July 2025
6th December 1959 to 5th January 1960 6th September 2025
6th January 1960 to 5th February 1960 6th November 2025
6th February 1960 to 5th March 1960 6th January 2026
6th March 1960 to 5th April 1960 6th March 2026

A person born after 5th April 1960 but before 6th April 1968 attains pensionable age when the person attains the age of 66.

Period within which birthday falls Day pensionable age attained
6th April 1968 to 5th May 1968 6th May 2034
6th May 1968 to 5th June 1968 6th July 2034
6th June 1968 to 5th July 1968 6th September 2034
6th July 1968 to 5th August 1968 6th November 2034
6th August 1968 to 5th September 1968 6th January 2035
6th September 1968 to 5th October 1968 6th March 2035
6th October 1968 to 5th November 1968 6th May 2035
6th November 1968 to 5th December 1968 6th July 2035
6th December 1968 to 5th January 1969 6th September 2035
6th January 1969 to 5th February 1969 6th November 2035
6th February 1969 to 5th March 1969 6th January 2036
6th March 1969 to 5th April 1969 6th March 2036

A person born after 5th April 1969 but before 6th April 1977 attains pensionable age when the person attains the age of 67.

Period within which birthday falls Day pensionable age attained
6th April 1977 to 5th May 1977 6th May 2044
6th May 1977 to 5th June 1977 6th July 2044
6th June 1977 to 5th July 1977 6th September 2044
6th July 1977 to 5th August 1977 6th November 2044
6th August 1977 to 5th September 1977 6th January 2045
6th September 1977 to 5th October 1977 6th March 2045
6th October 1977 to 5th November 1977 6th May 2045
6th November 1977 to 5th December 1977 6th July 2045
6th December 1977 to 5th January 1978 6th September 2045
6th January 1978 to 5th February 1978 6th November 2045
6th February 1978 to 5th March 1978 6th January 2046
6th March 1978 to 5th April 1978 6th March 2046

A person born after 5th April 1978 attains pensionable age when the person attains the age of 68.

Proposed Changes

The proposed changes to the State Pension age timetable, announced in November 2010, affect those born between 6 April 1953 and 5 April 1960.These proposed changes to the timetable are not yet law and still require the approval of Parliament.

Date of birth Date State Pension age reached
6 December 1953 to 5 January 1954 6 March 2019
6 January 1954 to 5 February 1954 6 July 2019
6 February 1954 to 5 March 1954 6 Nov 2019
6 March 1954 to 5 April 1954 6 March 2020
6 April 1954 to 5 April 1960 Your 66th birthday

You should be aware that the government is considering the current timetable for future increases to the State Pension age from 66 to 68. Any change to the timetable would require the approval of Parliament.

January 2011 - Default Retirement Age (DRA) update - Result of the consultation

On January 13th 2011, we saw the much anticipated publication of the Government's response to the consultation process on the phasing out of the DRA.

We welcome the announcement of an exemption for Group Risk insured benefits and are delighted that it has recognised our request to consider the importance and value of Group Risk benefits to employers and their employees. As a result of the exemption employers will continue to be allowed to have the choice to cap Group Risk benefits in line with the State Pension Age; meaning that the costs of providing these benefits will not become prohibitive.

The Government's decision will enable us to continue to support its welfare reform initiatives and offer employers the peace of mind that they can financially support their staff for the long-term, through the provision of comprehensive Group Risk benefits. We believe that the recognition of the value and importance of these benefits will create opportunities to expand the market further; where the past few years' uncertainty may have put off some employers taking the plunge into providing cover for their employees.

When will the DRA legislation come in?:

The Government plans to introduce the new regulations from 6 April 2011. From this date, subject to Parliamentary procedures, employers will no longer be able to issue notifications of retirement using the DRA procedure. However, where notifications have already been made prior to 6 April, employers will be able to continue with the retirement process provided that retirement is due to take place before 1 October 2011.

What does it mean to us?:

We see it as a great opportunity for intermediaries to provide consultancy and advice to better understand employer and employee needs.

We look to provide solutions that meet these needs, rather than simply offering products that appear in the past have been deemed complete; focusing on support in prevention and intervention, with personalised advice and action planning, as these are the keys to a healthy and productive workforce. From pre-employment screening through to absence management, health promotion and the management of long-term claims, we can help employers, and employees, with a tailored and personalised solution to meet their business performance needs.

If you'd like to know more about our Group Risk products and services please get in touch with our Group Risk Sales Support team on 0845 300 4452.

Lines are open from 8.30am - 5.15pm, Monday to Thursday; 9am - 5pm, Friday. Calls to and from Aviva may be monitored and / or recorded.

What is the Default Retirement Age?:

The Age Regulations which came into force on the 1 October 2006 introduced a new default retirement age (DRA) of 65, effectively allowing employees to work beyond their normal contractual retirement age. Employers can only retire an employee earlier if they can 'objectively justify' a lower retirement age. This is fairly complex and undefined and in general means the employer must proportionately show that the discriminatory behaviour is required to achieve a legitimate aim which could include economic reasons, such as threat of job losses or training requirements. Furthermore an employee currently has a statutory right to at least six months notice and a right to request to work beyond 65, which has to be considered by the employer by way of a formal interview process.

November 2010 - Group Income Protection - New escalation rate

With effect from the 22 November we will be offering a new escalation rate for Group Income Protection.

The new rate will be measured against the Retail Price Index (RPI) capped at 2.5%. This is in line with the current Limited Price Indexation rate.

This will complement our existing Group Income Protection escalation rates of 3%, 5% and RPI capped at 5%.

November 2010 - Group Income Protection - Employee Assistance Programme (EAP) now included

Our EAP is a confidential advice and information service - and is now free when your client purchases an Aviva Group Income Protection policy.

Find out more

October 2010 - Group Life - Pension simplification (A Day) update

Aviva would like to remind you that the notional earnings cap transitional period for Group Life schemes that were set up before 6 April 2006 is ending on 5 April 2011.

Find out more about pension simplification (A Day) update

April 2010 - Group Life - Increased Free Cover Limit

With effect from 01 April 2010, we will be increasing our maximum Free Cover Limit for Group Life.

The maximum Free Cover Limit will increase from £1.75 million to £1.8 million for large schemes of 3000 lives or more.

This new maximum Free Cover Limit will apply to all large new schemes and existing schemes with commencement dates / renewal dates of 1 April 2010 onwards and mirrors the new Lifetime Allowance of £1.8 million.

April 2010 - Group Life - Capitalisation (cap) factors

With effect from 01 April 2010, due to a continuing very low interest rate and the resulting high cost of purchasing dependant annuities, new higher capitalisation (cap) factors are to be introduced. The new respective cap factor will be detailed on each new dependant’s death in service pension illustration.

For further information please speak to your usual Group Risk Consultant.

March 2010 - PRODUCT LAUNCH - Group Critical Illness

On 15th March 2010 we launched our new Group Critical Illness product.

This new addition to our Group Risk portfolio is our third Group Risk proposition enhancement in just over 4 months, with our Group Income Protection Pay Direct and Lump Sum products launching in November and January respectively.

We are now able to offer a complete portfolio of Group Risk products.

You can find out more about, and download literature for, our Group Critical Illness product here.

January 2010 - Group Income Protection - Lump Sum

On 11th January 2010, we launched our Lump Sum proposition for Group Income Protection. This product gives the employer the choice of a limited payment term with a lump sum of up to five times salary or nine times income benefit payable when it is completed.

January 2010 - Group Life - Increased Free Cover Limit

With effect from 01January 2010, we will be increasing our Free Cover Limit for Group Life.

Our formula for calculating the Free Cover Limit will increase from £15,000 to £20,000 multiplied by the number of lives insured.

The maximum Free Cover Limit will also increase from £1.25m to £1.5m for schemes of 500 lives or more, and from £1.25m to £1.75m for schemes of 3000 lives or more.

November 2009 - Group Income Protection - Pay Direct launched

On 23 November 2009, we launched our Group IP Pay Direct offering to the market.

September 2009 - Group Risk - TIV launched

On 1 September 2009 we launched the use of tele-interviews for all Group Risk members who require medical underwriting.

The use of tele-interviews will lead to a much more efficient underwriting process, less requests for additional evidence, and much quicker underwriting decisions.

August 2009 - Group Income Protection - increased maximum benefit limits

In August 2009, we were the first provider in the Group Risk market to increase our maximum income benefit limit from £300,000 to £350,000, and our maximum employer pension contributions limit from £50,000 to £75,000.

Holiday pay ruling

The House of Lords has recently ruled that whilst employed persons are off sick they are entitled to accrue holiday (in a similar way to those on maternity leave). This means that when they go back to work they are entitled to take the holiday that accrued whilst they were off sick, or receive a payment in lieu of holiday. We may also see employers making lump sum payments in lieu of holiday, whilst the employee is still off sick.

Likewise, if the employer terminates the contract they are required to pay the employee in lieu of the holiday that has accrued during absence.

What does this mean for you?

Our stance for now is that we will not insure the additional holiday entitlement, but we will not count this as continuing income whilst a member is in claim, and will therefore not reduce benefit payments. This is a balanced approach and in line with the market.

If you’d like to know more

Talk to us, we’re happy to help. Get in touch with our Group Risk Sales Support team on 0845 300 4452.

Lines are open from 9am - 5pm Monday to Friday.

Calls to and from Aviva may be monitored and / or recorded.

Hear what the experts think about Group Risk - Watch our videos

Hear what the experts think about Group Risk - Watch our videos

Want to know more about Group Risk? Download literature from our library

Want to know more about Group Risk? Download literature from our library

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