Why did you choose a career in the food industry? I suspect some of you started in a Saturday retail job while others were lured by the graduate milk round. More may have wanted to work in a company with a well-known brand or an international presence. But I wager none of you considered the death in service benefits your employer offers when choosing an industry in which to work.
It’s not something we like to think about but one in a thousand people dies while they are in employment and the insurance paid out to loved ones gives some comfort at a difficult time. But the average death in service payout varies enormously between sectors, as I discovered when I asked advisor Punter Southall Health & Protection Consulting (PSHPC).
PSHPC mined data from more than 400 corporate clients, covering 110,000 employees, to find out which industries provide the most and least generous death-in-service benefits for the average employee. The good news is employers in the UK tend to offer higher levels of life assurance than those in many countries, with the typical average being four times salary.
The bad news is that, while high-skilled manufacturing pays on average 4.4 times salary, sales and distribution comes in at 3.3 times salary and retail brings up the rear, with 3.03 times salary on average. To put this into context, dependents of a typical £14,000 a year retail employee would get £42,000. At the other end of the scale, financial sector employees can receive multiples of seven-plus, meaning an employee on a six-figure salary would have a £1m pot.
Still, there is a group of employees in lower-paid work in retailing, manufacturing and agriculture that does not receive any life assurance benefits, according to PSHPC director John Dean. “There are also others who are ‘unprotected’. Some employers do not provide life assurance while in probation and many policies will cease at state pension age, so staff working past this date may no longer be insured.”
So it’s worth checking out your employer’s scheme. But employers also need to beware, for Dean estimates a 500-employee company with an average salary of £30,000 paying four times life assurance is carrying £4.8m in uninsured liability. With margins tight, that’s a cost you/they do not want to pay out.