Presentation on theme: "Vitality for Business For Advisers. 2 Relative size of market for each need Understanding the issue Source: Tower Watson – Global Medical Survey 2014."— Presentation transcript:
2 Relative size of market for each need Understanding the issue Source: Tower Watson – Global Medical Survey 2014 & Office of National Statistics 2014 It makes sound business sense for both insurers and employers to engage employees in their health. Leading causes of sickness absence Work days lost due to condition Musculoskeletal30.6m Accidents21.7m Mental Health15.2m Gastrointestinal8.7m Respiratory5.3m Cardiovascular5m Cancer?
3 Controllable behaviours Poor nutrition, lack of exercise, smoking and alcohol Chronic diseases of lifestyle Cancer, diabetes, lung disease, cardiovascular disease and Liver disease 65% of deaths worldwide 4 5 65 65% of worlds deaths from lifestyle factors Source: WHO (2011) and modified Oxford Health Alliance model, 2013 Numbers to remember
5 Summary of Vitality benefits by product Type of planHealth partner discounts Opportunity to control premiums by looking after health The opportunity to earn cashback A range of additional rewards Upfront discount on premiums PruProtect or Essentials Plan for Business Protection with Vitality Optimiser PruProtect Plan for Business Protection with Vitality Plus Essentials Plan for Business Protection with Vitality Plus Relevant Life Policy with Vitality Optimiser Business Protection Plan or RLP with Vitality Plus Business Protection Plan or RLP with Vitality NB. Business Protection and Vitality - the insured person get access to Vitality. The planholder gets any upfront discount, cashback or premium discounts.
6 Vitality: incentivising behavioural change Vitality partners Vitality Plus and Vitality Optimiser partners
7 Relative size of market for each need “Evidence shows a strong correlation between the prosperity of a business and the health of its employees.” (WHO, 2002) Benefits to the employer Increase productivity Reduce absenteeism Reduce presenteeism Help recruitment and retention More engaged and loyal employees Good health means good business…
9 Gym membership Health screens Cinema Holidays Cycling Stop smoking sessions Vitality as an employee benefit Key target audience: SMEs 4.85 million SMEs in the UK
10 Source: Personnel Today – May 2012 Employer perception of benefits valued as top 3 employees
11 Vitality Plus and Vitality Optimiser Vitality Plus and Vitality Optimiser work differently for Relevant Life Polices. The planholder (employer) receives: upfront discount (Vitality Optimiser only) any premium discount that applies (Vitality Optimiser only) any cashback that applies (Vitality Plus and Vitality Optimiser) The person covered (employee) receives the remaining Vitality benefits. For Relevant Life Polices Even the employer gets something back with Vitality Plus and Vitality Optimiser
12 HMRC Approval and tax position Approval - clearance obtained from HM Revenue & Customs on 6 February 2014. Tax - Typically if you reward an employee with anything other than pay it may count as a benefit on which tax is payable. However, HMRC have agreed that: »For employees, Vitality Plus premiums are small enough to not be a taxable employment benefit. »For employers, Vitality Plus premiums are deductible as an employee welfare expense. P11D reporting is not required. »Any cashback the employer receives is likely to be subject to corporation tax in their normal way at their usual rate. However, you will need to take your own tax advice. See HMRC Guidance in the Business Income Manual, chapter BIM47070 HMRC confirmation 21 st May 2014
13 Why should advisers consider talking about health and wellness? Client RelationshipBusiness Case Deliver a proposition which meets 21 st century health and wellbeing needs Improve commission income Deliver clients 5-star insurance at potentially 2-star premiums Build client book Deliver clients meaningful everyday benefits and savings Reduce lapse rates Give clients the feeling of exclusivity Protect client book Become intermediary of choiceIncrease referrals