How Income Protection Can Be Part of the Work and Health Solution

The latest Action for Healthier Working Lives report by the Health Foundation sends a clear message: the UK’s working-age health crisis is growing – and inaction is no longer an option. Over 8.2 million people now live with work-limiting health conditions, and 300,000 leave the workforce each year due to ill health, often with little to no support to return.

✅ Some of the key messages include:

1. Only 3% of people return to work after being out of work for 12 months due to health conditions.

2.  £150bn/year cost to UK employers due to poor workforce health.

3.  The need to expand vocational rehabilitation and introduce a vocational rehabilitation benefit.

4.  Only 45% of workers have access to vocational rehabilitation or occupational health services.

5.  Insurers in other countries play a greater role in early return-to-work support 

6.  Strong return-on-investment potential: new support models could help 100,000 people stay in work and save £1.1bn in 5 years.

7.  The report’s call for early, personalised, and joined-up intervention. 

8.  The focus must shift from simply diagnosing illness to proactively addressing work and health challenges.

💡 My reflections for the Income Protection sector.

· The insurance sector needs to keep abreast with the health risk landscape, which is looking increasingly complex based on the report.

· Good to see support for evidence-based interventions considering multiple factors: health, yes – but also psychological factors, job design, management, social support and timely vocational rehabilitation.

· Early Intervention (EI) with practical support to address work challenges should be considered early (at 4 weeks of sickness absence).

· The Group IP market, where EI is more embedded, was briefly mentioned in the report.

· The Retail IP market faces challenges regarding absence notification timeframes depending on deferred periods (26W and 52W in particular). Thus, Early Intervention strategies need to be adapted.

· The vocational rehabilitation benefit mentioned in the report is an interesting concept. Most IP products have a Proportional Benefit (PB) incentive. However, it is very common to see customers presenting with fear avoidance, low self-confidence and deconditioning after a long period of absence. Perhaps we could review ways in which IP could incentivise a sustained return to work, with a modified PB? I have various ideas on early incentives and product enhancements.

· Integrating vocational rehabilitation in IP can support customers’ health and work goals, taking into consideration the health condition, work capacity, any residual limitations and the role demands.

The full report can be accessed here: https://www.health.org.uk/reports-and-analysis/reports/action-for-healthier-working-lives