Group Death in Service (DIS)

What is Group DIS?

A DIS scheme allows employers to provide a tax free lump sum benefit and/or a dependant’s pension to an employee’s family and children, if they should die whilst employed.

Product Features

DIS schemes can offer, in the event of an employee’s death whilst employed a multiple of salary (i.e. 2. 3 or 4 x salary) and/or a fixed amount as a lump sum benefit to the employee’s family and dependants.

A death in service pension can offer a regular income to an employee’s dependants with this being based upon a percentage of an employee’s salary or, in some circumstances, their prospective pension. It is also possible to include benefits for surviving children which can either be in addition to the spouse’s pension or payable should the spouse also die.

Benefits for employers who use these schemes:

This is one of the cheapest employee benefits you can offer your employees.
The registered schemes premiums are usually allowable as a business expense and are therefore corporation tax deductible.
Employers can set different levels of benefits for different staff so senior employees can have a level appropriate to their position.
A group life assurance scheme can offer a free cover limit therefore meaning that medical evidence is often not required at all (this is scheme size dependent, the larger the scheme the larger the free cover limit).
Having Group DIS in place means employers can contribute invaluable financial support to beneficiaries.
Having wide range of employee benefits helps attract and retain staff.

Benefits for Employees

Any premiums paid on an employee’s behalf are not treated as a benefit in kind.
Any lump sum benefit is normally payable outside an employee’s estate and free from Inheritance Tax liability.
A group life assurance scheme can provide peace of mind and reassurance.
Cover can be continued, up to a certain period, when an employee is absent from work due to sickness or taking, with an employer’s consent, a sabbatical.
Employees who have had protection polices rated, with exclusions or cover not offered can receive up to free cover limit without medical underwriting.

The above information regarding taxation is based upon our understanding of current legislation which, of course, is liable to change in the future and would depend upon an individual’s financial circumstances.

What do Quest Financial Solutions do for you?

We research the entire market to find the most suitable cover at a competitive price.
We implement and administer the scheme for you on a day to day basis (including assistance with registering the scheme with the HMRC).
Each year (or two years depending on the initial scheme terms) we review the open market to make sure the product remains competitive and suitable to you as an employer.