Thinking of studying in USA? Get to understand F1 Visa required for international students

The F1 Visa is the most popular visa forinternational students who came to study in US. 

There are no specific insurance requirements for F visa holders set forth by the US government, and in most cases your college or university will determine what level of coverage you need, or you will need to make this determination for yourself if no specific insurance requirements were set by institution you plan to study.

Since the health insurance requirements for F1 visa holders will vary depending on your university or college, coverage can be administered in a variety of ways:

• Mandatory school-sponsored group insurance plan, with no option to waive coverage
• School-sponsored insurance plan, with the option to waive
• No school-sponsored insurance plan, with the option to choose your own coverage

Mandatory Insurance Plan

If your school has chosen to implement a mandatory insurance plan, you have no option but to purchase coverage predetermined by your college or university, and in many cases the cost of the insurance is automatically added to your tuition bill. Mandatory school-sponsored insurance options like this tend to be more expensive than purchasing an individual plan, but they are known to provide more comprehensive coverage as well, including coverage for maternity, pre-existing conditions without a waiting period, mental health, wellness and preventative care.

If your school handles their insurance coverage in this way, there are a few things you should be aware of to make sure you have the full coverage you need. Firstly, check to make sure the plan will cover you while on school breaks. If not, then a Travel Medical plan may work well in that situation. Secondly, some mandatory school-sponsored insurance plans do not provide coverage for emergency evacuation, repatriation and some travel related benefits you might need. If this is case, you might want to consider purchasing a standalone evacuation and repatriation plan to cover those costs.

Mandatory Insurance Plan, with Waiver

Some schools will offer a mandatory insurance plan, but allow students the option to waive coverage if they can prove they’ve purchased a comparable international student health insurance plan. To help determine if an outside plan is adequate, schools create a “waiver form.” This document is usually 1-2 pages long, listing each of the benefit requirements that your own plan needs to either meet or exceed, and requires both your signature and that of the insurance company. Only once both you and the insurance company have competed the appropriate sections of the form and given it back to your school will you be removed from the school’s plan.

No Mandatory Insurance Plan

When your school has not provided a specific insurance plan you need to purchase, or have no health insurance requirements, you have the ultimate flexibility to choose the insurance plan that best fits your needs and budget! It’s important to make sure that the insurance plan you choose provides comprehensive coverage by reviewing the exclusions, ensuring that the plan is underwritten and administered through a reputable company, and speaking to a licensed insurance broker to help address any questions you may have.

Common School Insurance Requirements

Even though each school will create its own “waiver form” to determine if an outside health insurance plan will be considered adequate to waive school-sponsored coverage, the majority of colleges and universities require the same basic benefits:

• Adequate Policy Maximum – Since this is essentially the limit that your insurance policy will pay towards your medical bills, colleges and universities often require their international students to purchase a plan with a policy maximum of at least $50,000. With this in mind, some schools will require an unlimited policy maximum, meaning there will be no set cap on your coverage.
• Relatively Low Deductible – To help keep students out of pocket costs as low as possible, schools often include a deductible limit per condition, or per policy period, as part of their waiver requirements.
• Mental Health Coverage – To help ensure students are both physically and mentally healthy, outside health insurance plans are generally required provide both in-patient and out-patient mental health care, either at a set dollar amount or a percentage per visit.
• Maternity Coverage – As a preventative measure, adequate maternity coverage is another popular health insurance waiver requirement for international students. Schools don’t generally require maternity to be covered at a specific dollar amount, and instead request a high percentage to be covered, typically at least 80% coverage in-network for pre-natal, delivery and post-natal care.
• Pre-existing Condition Coverage – Oftentimes schools will require your health insurance plan to include coverage for conditions that you may have had prior to arriving in the United States, either with or without a waiting period.
• Emergency Medical Evacuation Coverage – Evacuation coverage is required by federal law for J visa holders, making it a common benefit for schools to include in their “waiver forms.” In a nutshell, evacuation coverage will help transport you to the nearest medical facility that can provide appropriate care – either by ground or air transportation depending on your insurance plan.
• Repatriation of Remains Coverage - Also known as the Return of Mortal Remains, repatriation coverage provides financial assistance to your family in the event you were to pass away while outside of your home country. To help make this process as easy as possible, schools often require your insurance plan to include repatriation coverage to help provide the proper planning, logistics, and financial coverage for your family if such a tragedy were to occur.

After you know whether your college or university set up the requirements for health insurance plan for F1 visa holders, get the information on what is offered, what are the benefits, can the dependents be covered under your policy and what are the costs. If you do have the option to waive your school’s option, feel free to contact us to help you find the best product for international students, compare and advise which is best for your situation.

Expat Solutions is a trading style of In2Matrix Global Insurance Solutions

Why to buy International Health Insurance?

Whatever situation you have and wherever you are in the world, when it comes to your health, international health insurance gives you the greatest protection and peace of mind you could hope for. It can feel like a bit of a leap if you’ve never taken out private health insurance before, so it’s good to know what the benefits are before you decide. You can do an independent research, get the advice from fellow expats or leave to experts to give you all the answers.

You can benefit from private health insurance anywhere in the world. International health insurance is designed for those who:

• are retiring overseas
• are working abroad
• have already settled in another country
• are globally mobile and frequently travel from country to country
• are looking for the most extensive private health cover

Expats are a fact of life in this modern, globalized economy and the world is getting smaller; it is not just large multinationals who send employees overseas, but also medium to small sized companies, along with contractors and freelancers. Travel insurance is not enough if you’re planning to build a new life abroad, or if you divide your time between homes in different countries. You need protection that will be flexible enough to allow for all the ups and downs of resettling in another place. For extended visits, travel insurance will serve you well. When you’re going somewhere for much longer, international health insurance is designed to suit you. It offers bespoke cover and protection for as long as you want into the future.

Moving abroad is often a daunting prospect, and there are so many things that can be a wrench to leave behind. Anxiety about leaving a country with reliable health services is about more than familiarity – you need to feel confident that you’ll be well looked after wherever you go and whatever happens.

Our team of global benefit experts understand what matters most when living or working overseas – not only in terms of day-to-day healthcare and support, but also the necessary consideration of regulations in each country around the world relating to private health insurance, pensions and the provision of other international insurance products.




Expat Solutions is a trading style of In2Matrix Global Insurance Solution

Guide for expats into International Insurance

When moving abroad to live or work, you want a sense of security for yourself and your family, but choosing which type of insurance coverage for you and your family is needed can be overwhelming.

Country-specific considerations
When moving abroad you'll need to consider what regulations and options are available to your specific host country. When you're researching your host country, it would be a good idea to reach out to the expat forums and find out what your fellow expats decide - public or private insurance. Some countries offer government funded subsidies for healthcare others don't. Finding out as much as possible in advance of your trip is a vital step.

Health insurance
If you're moving abroad for work, your company may already be offering you health coverage for yourself and your family. As most expats are covered under the employer's insurance you still might need to purchase more if you have a chronic or pre-existing condition. Travel insurance may be sufficient if you will only be visiting for a short period of time and don't have any pre-existing conditions. 

Life insurance
Expats with dependents should seriously consider purchasing life insurance policies. For obvious reasons, researching a life insurance policy is something most people try to avoid -- who wants to think about their own death? No one. But unfortunately it's something that should be taken seriously. What will happen to your spouse in the event of your death? What would their financial situation be like? This is where life insurance comes into play. 
When it comes to purchasing life insurance, review your current situation. What will you need your life insurance plan to cover? You may already have a life insurance policy that you've forgotten about. If you have an old contract whose details you don't remember, contact your insurance company as soon as possible. Your coverage might only need a bit of tweaking and updating to be current again. 




Alternatively, leave your worries to us - experts who will not only advise you on available international insurance products for experts, specific country requirements but also with extensive worldwide connections with insurers and underwriters will negotiate best rates for you for the best policies that fits with your needs, as well as support you throughout the process from selecting, buying to claims management.




Contact us to receive more information on international products, our services or country guides to help you and your family with your international move.

Press release: HR & Finance: Hand in Hand

Press Release

27 June, 2017

In2Matrix was delighted to participate in the IV annual conference for HR and Financial Directors held on 14 June 2017, organised by ACCA Russia and BDO Unicon Outsourcing. This conference was attended by more than 200 HR and Finance directors of various industries.

‘HR & Finance: Hand in Hand’, was the presentation of Gerard Baltazar, Chairman & CEO of the In2Matrix Group and member of the advisory board of RBCC (Russo-British Chamber of Commerce). ‘I hope you all agree that employees are the most important assets - not just buildings, machines, stocks and shares. Nourishing and cherishing this most important asset is the key to the success of any business. Traditionally, the HR and Finance departments each have been focused on different areas of the business strategy. HR professionals were dedicated to the effective and efficient deployment of human capital, focusing on attracting and retaining talents, while finance managers often viewed the human capital merely as a cost and the HR department as an expense, which does not generate revenue. Luckily, recent trends show that the traditional roles of HR and Finance are shifting: both departments are finding their focuses overlap more and more. From the perspective of the Finance department profitability remains the goal; however, that goal cannot be reached without a high-performing workforce, who is aiming to meet the same objective. To achieve this objective, it is crucial that both HR and Finance professionals work together hand in hand.’

It is important to note, that the conference was held this year under the title «HR & FINANCE: SURFING LESSONS. HOW TO CONQUER THE WAVE OF CHANGES AND MANAGE TO STAY ON» - therefore the topic of consolidation of employee benefits programs as one of the methods to maximise cost savings was of great­ interest to the conference attendees.

The conference also covered other hot topics such as: ‘what to do if a company is not ready yet for changes’, ‘most effective HR and Finance trends’ and ‘how to address the ever changing market’.

Contacts:

For more information, contact:

Margot Clarenbeek

Margot.Clarenbeek@in2matrix.com

+31 617 593 981

Insurance Premium Tax Hike Effective 1st October

On 16th March 2016, the government announced that the Insurance Premium Tax (IPT) will be subject to another hike. Yet, it will only increase by 0.5 per cent and all the revenue generated from it will fund national flood defences and resilience.

This hike comes just after a previous 3.5 per cent increase on 1st November 2015—resulting in a tax increase of 66.6 per cent since then. While this hike is considerably smaller than the previous one, you should nevertheless familiarise yourself with the increase and its potential repercussions.

Understanding the Tax Hike

The standard IPT will be increased by 0.5 per cent—raising it from 9.5 per cent to 10 per cent—and will apply to insurance premiums starting on 1st October 2016. The government estimates that the hike will generate an extra £80 million in its first year and then an annual average of £205 million in subsequent years.

This annual revenue boost will come from all households and businesses that pay IPT on their insurance. However, there are several policies that are exempt from the IPT, including the following.

·         Life insurance

·         Insurance for commercial ships and aircraft

·         Insurance for commercial goods in international transit

·         Premiums for risks located outside the United Kingdom

·         Export finance

Potential Repercussions

Despite the rise in costs, the government is confident that there will only be negligible impacts to the public and private sectors. These include one-off costs for insurers to update their systems to include the new tax rate.

The government estimates that the average combined home and contents policy will increase by £1, and the average motor policy will increase by £2 per year. But this is in addition to the extra £100 added to the average household’s insurance bill from the last increase, according to the Association of British Insurers (ABI).

The ABI has also estimated that the 0.5 per cent increase could cost UK businesses as much as £75 million. Those losses, coupled with consumers’ potentially lower spending power due to higher insurance bills, could further squeeze businesses’ profit margins. In response to this squeeze, the Automobile Association (AA) is cautioning against businesses and motorists forgoing cover in order to save money, given that a 2015 AA poll found that 87 per cent of motorists believed that the IPT was unfair and that increases will encourage some drivers to attempt to drive without insurance.

However, the government believes that the IPT hike will benefit the UK economy, arguing that it brings the United Kingdom’s IPT in line with other countries. At 10 per cent, the United Kingdom has one of the lowest IPT rates in Europe—still much lower than Germany’s 19 per cent IPT and Italy’s 21.25 per cent IPT. With competitive rates and a robust, diversified insurance industry, the government hopes to continue attracting new international business due to its relatively low IPT.

What Happens Now?

In2Matrix (UK) Ltd is committed to providing you with the most robust, cost-effective cover and will do everything in our power to ensure that the IPT increase has the smallest possible impact on your policy.

Risk Insights: Young Employees and IT Security

Hiring young employees can bring fresh talent and innovation, giving your company an edge over your competitors. But that edge can quickly be erased, as young workers also bring additional technology risks. According to the Cisco Connected World Technology Report, a study involving almost 3,000 university students and young professionals under age 30, 70 per cent of young employees frequently ignore their company’s information technology (IT) policies.

Generation Y, generally those born in the early 1980s to late 1990s and also known as the ‘Net Generation’, have grown accustomed to sharing everything about their personal lives on Internet sites such as Facebook® and YouTube®. This poses a dilemma for an employer: If young employees don’t safeguard their own personal information, how can you entrust them with your company’s sensitive data? Companies with the need to be Internet-savvy must hire young talent…but are these employees worth the risk?

Eye-opening Statistics

The Cisco report cites 80 per cent of young employees think their company’s IT policy is outdated or they don’t even know about it. Additionally, 25 per cent of those in the study had been a victim of identity theft before age 30.

Why are young employees negligent about IT security? The study found that some young employees’ attitudes and beliefs towards IT policies include:

·         They forget about the policies.

·         They think their bosses aren’t watching.

·         They believe the policies are not convenient.

·         They think they don’t have time to consider the policies while they’re working.

·         They feel they need to access unauthorised programs to get their job done.

·         They believe security is the IT department’s responsibility, not their own.

Additional Risks to Consider

Young employees can compromise IT security by leaving their computers or other personal devices unattended, increasing the risk that that both the equipment and company data could be lost, stolen or misused. Sending work-related emails to personal email accounts, and using computers and social networking sites for both work and personal reasons can also compromise IT security. Generation Y workers are more apt to blur the line between using IT for both personal and work-related purposes, which can increase the risk of negligence.

Consider that not only young employees, but all employees can compromise IT security in the following ways:

USB flash drives. While these are convenient portable devices for storing information, they make it too easy to take sensitive information out of the office and can be misplaced easily since they are so small.

• Wi-Fi networks. Whether it’s an employee’s personal Wi-Fi network at home or free Wi-Fi at the local coffee shop, it is important that employees use virtual private network (VPN) and take other security measures when they log in on networks outside of your company.
•  Laptop computers. Lightweight and handy for working remotely, laptops are also susceptible to viruses from improperly-secured Wi-Fi networks.
• Smartphones. They provide information at your fingertips, but are also another portable way to take sensitive data out of the office.
• Collaboration websites. Websites, such as a wiki or SharePoint® site, are great tools for employees working together on projects; but it’s critical that only authorised employees are logging in and accessing your company’s projects on these sites.
• Social media tools. Sites such as Facebook and Twitter can benefit your business; however, negligent use, including sharing critical company information, can be a risk.
• Other communication applications, such as peer-to-peer (P2P), Skype and instant messaging tools.

These applications can be vectors for malware and a threat to information security.

Employers shouldn’t necessarily prohibit employees from using technology, as this list includes many tools they need to get the jobs done. It’s important to know the risks and educate young employees to use the technology properly.

Mitigating the Risks

Employers must find the balance between allowing young employees to use social networking websites and portable devices to do their jobs, while at the same time protecting company information. Employers should examine their exposures and consider what level of risk they are willing to accept.  Other special considerations for managing young employees and mitigating the risk include:

Review your company’s IT policy. If it needs to be updated, ask recent graduates for advice on updating the policy to reflect current changes and trends in IT.

• Make sure young employees (and all employees) are aware of your company’s IT policy and the consequences if the policy is not followed.
• Create strong, trusting relationships between young employees and your IT department.
• Create IT awareness materials so young employees are continually reminded of IT security risks and what they can to do prevent them.
• Train new young employees on data protection and IT security risks, and provide refresher training for seasoned employees to ensure everyone is aware of the risks and the importance of safeguarding company information.

Contact In2Matrix (UK) Ltd for more information on how to avoid IT security risks. 

Key Person Insurance Cover

If an employee crucial to the function of your business becomes disabled or dies, would day-to-day activity continue as usual or would disorder and uncertainty ensue? Would you be able to maintain the same level of business expectations and revenue stream? How will you cover for the financial loss of the employee or pay for a temporary replacement during his or her recovery? Key person insurance could help you answer these questions with confidence. It is designed to provide financial stability in a time of stress and anxiety due to the sudden loss of an important employee.

Who Needs Key Person Cover?

 Many businesses benefit from key person insurance, like those with:

• Employees who would be extremely difficult, time-consuming or expensive to replace (ex: central decision makers, chief executives and directors, vital sales managers or employees whose ideas have critical commercial impact)

 

• Highly skilled employees with unique training

 

• Employees with exclusive ties to key clients

 

• Narrow profit margins where a staff loss would mean financial trouble

 

•  A need to protect their revenue stream from loss (for example, hospitals protecting against the loss of a high-earning, respected surgeon)

 

• Concerns that a high revenue-producing client (ex: actor, writer or other entertainer) became disabled or died and was unable to perform

 

• In the event a vital employee becomes disabled or dies, this type of insurance provides the company with income to make up for financial loss or use for temporary replacement costs.

 

 

Considerations Before Purchasing Key Person Insurance

 

Estimate the value of your key employees. Think about the projects that would be lost without them, the amount of sales generated by them and the costs associated with replacing them.

Think about the amount of protection needed. There are several methods to calculate this, including using a multiple of salary or profits, payroll proportion, and the actual impact method.

Determine whether this cover is necessary and whether it is already covered under a comprehensive policy.

Create a business continuity plan that outlines how your business will function if you lose key employees. In addition to proper cover, having such a plan is vital.

 

Requirements and Cover Options

To qualify as a key person, most insurers require that the employee’s salary be in a top percentage of the company. Qualifications vary based on the insurer. All key person policies are written specifically for the employee in question. To learn about cover options, limits and other plan details, contact us at 44 (0) 20 3638 5152 to talk to an expert at In2Matrix (UK) Ltd.

Insurance for Medical Professionals

 

Medical professionals shoulder a huge amount of responsibility on a daily basis. Their job duties can sometimes even be a matter of life-and-death. Because your job as a medical professional can involve many risks, you should make sure you have robust cover to protect yourself, your business and any employees. The following is an overview of common risks to medical professionals and the appropriate cover to shield against those risks, so you can focus on helping people and gain peace of mind.

Medical professionals need insurance to help protect themselves against the wide-ranging risks inherent in their jobs, such as malpractice, negligence and other claims that arise from liabilities or a breach of professional duty. Insurance for medical professionals can cover public and private hospitals, surgeries, clinical research units, industrial and occupational health clinics, care homes and more. The breadth of protection mirrors the extensive risks.

Who Needs It?

Anyone who works in the medical profession needs to seriously consider medical professionals insurance. This includes doctors, nurses or midwives, or more specialised positions such as occupational therapists, physiotherapists and paediatricians. For some, certain covers like medical indemnity may be a regulatory requirement, so make sure you know the specific requirements for your profession.

Depending on your regulatory body, you may already be covered. For example, the National Health Service (NHS) insures most of its medical staff for the duties in their contracts. However, the NHS may not cover everything, and can render employees vulnerable by leaving gaps in cover. Whether the NHS or another health care organisation insures your professional conduct, the British Medical Association still recommends supplementary insurance to compensate for porous cover. Check your policy to determine whether it leaves you or your employees exposed.

Medical Indemnity Insurance

 A comprehensive medical indemnity policy inspires the confidence to do your job without being plagued by the stress that accompanies allegations of negligence.

A typical medical indemnity policy will cover you on a claims-made basis in the event of malpractice, breach of duty or dishonesty of your partners, directors or employees in the course of business operations. It can also provide compensation for claims and legal services, and insure against actions or omissions of your employees. Cover is usually arranged according to the specific medical profession. The following three main types of indemnity cover are organised by position:

Doctors and dentists may need to extend their cover beyond NHS’ policy in order to practise medicine in affiliation with other professional health care organisations.  Extra private insurance helps protect against liabilities outside of the workplace, such as performing charity or volunteer work or administering emergency care while off-duty (Good Samaritan acts). Doctors and dentists not under contract with the NHS will need their own medical indemnity insurance.

Nurses and doctor assistants are usually covered under their employers’ insurance, but should check just to be certain. Because patients may file a claim against employers or against nurses and doctor assistants personally, it is wise to make sure your employees are covered on both fronts.

Pharmacists will probably receive professional indemnity cover through their employers. Independent pharmacists, however, need insurance to protect themselves against a vast array of industry-related claims such as providing incorrect dosages or medications, failing to prevent adverse drug interactions or giving shoddy advice.

Additional Cover

If you are a private medical professional and have your own premises, building and equipment, consider the following forms of cover to ensure you and your business are adequately protected:

• Employers’ liability—required if you have employees
• Property damage to contents and equipment
• Loss of money
• Public and products liability
• Property damage to buildings
• Business interruption
• Personal accident
• Computer equipment
• Legal expenses

 

 

Insurance Premium Tax Hike

 

On 8th July 2015, George Osborne, Chancellor of the Exchequer, delivered his Summer Budget 2015 to Parliament. One of the most controversial and unexpected measures of the Budget was Osborne’s 56 per cent increase to the Insurance Premium Tax (IPT), a tax on general insurance premiums. Considered a necessity by the government but a surprise ‘stealth’ tax by industry insiders, the IPT increase has caused consternation and confusion. Who will absorb the increased tax on insurance, and how will the IPT hike influence premiums?

The IPT increase applies to some insurance premiums starting on 1st November 2015 and all qualifying premiums on 1st March 2016. The higher rate of 20 per cent, which applies to some policies (such as travel and vehicle insurance) will remain the same. Other policies, such as long-term insurance, insurance for commercial ships and aircraft, and insurance for risks located outside the United Kingdom, are exempt from IPT altogether.

But, retaining the occasional exemption has done nothing to assuage the industry’s fears. Although the IPT applies only to insurers, industry insiders allege the increased costs will be passed onto the consumer, resulting in higher premiums, increased pressure on the NHS and more uninsured drivers due to policies such as private medical and motor being priced out of consumers’ reach. Indeed, the Association of British Insurers (ABI) estimates that the IPT hike will add £9.48 to the average annual household insurance policy and £12.25 to the average annual comprehensive motor policy. Other estimates have been more liberal, with some experts calculating that the average policyholder will pay an extra £17.50 as a direct result of the IPT hike, and others estimating that private medical insurance premiums will increase by between 7.5 and 15 per cent.

In addition to the anger over the economic impact, some industry insiders feel ambushed by the tax hike since they had no warning. The British Insurance Brokers’ Association (BIBA) was ‘extremely disappointed’ in the IPT hike and labelled it a ‘stealth tax’. Industry insiders feel that the IPT hike is especially unexpected given the recent cooperation between the government and insurance industry which resulted in a 3 per cent reduction to home insurance costs and a 2 per cent reduction in motor insurance costs, according to the ABI. The Automobile Association (AA) even went so far as to say the tax hike is ‘underhand’ and ‘unfair’.


And most consumers agree—87 per cent of motorists responding to a recent AA survey believe that the IPT hike is unfair.

The government, however, will not concede. Osborne maintains that the tax hike will only apply to one-fifth of all premiums and that the new IPT rate is still lower than other European countries’ rates, such as Germany’s 19 per cent IPT and Italy’s 21.5 per cent IPT. Osborne is further emboldened by the government’s recent crackdown on Britain’s ‘compensation culture’, which has helped to lower premiums across the board, according to the Financial Times. Along with the IPT hike, Osborne pledged to cap charges earned by claims management companies, which insurers say encourage people to make bogus claims and thereby raise premiums for everyone.

Some experts believe that the industry will just have to endure the increase, since soft market conditions should prevent insurers from passing on increased IPT costs to consumers. But, they caution, absorbing such costs without passing them onto the consumer could lead to insurers dropping affected insurance products, thus, reducing competition and subsequently hardening the market.

One thing is for sure—the IPT hike will raise insurance costs in 2016. What remains to be seen is whether the industry will pass these increased costs on to the consumer, and, if so, whether these costs will be negligible.

Contact us to learn more of insurance industry related news

 

Why does your insurance premiums change?

The Trickle - down effect of insurance pricing

 

Insurance premiums are not direct reflections of the risks insure. While inflation is a good start for anticipating changes in your rate each year, there are still other, more subtle factors you may be unaware of that affect the cost of insurance.

 

 

Factors impacting reinsurance

 

So far 2015 has been a quiet year for catastrophes—below the recent 10-year and 15-year averages—which has boosted profits for reinsurance companies because they paid out fewer and cheaper claims. Additionally, innovative investment options have provided opportunities for reinsurance companies to generate new capital.

Having extra capital on hand means reinsurance companies can insure more people and businesses—raising the competition for customers. As a result, primary insurance companies are paying lower premiums for reinsurance, a savings they can pass along to consumers like you.

 

 

Underwriting profit

 

Insurers measure their underwriting profits with their combined ratios. A combined ratio is calculated by dividing the sum of incurred losses and operating expenses by premiums. If insurers have a combined ratio of less than 100 per cent, they are making a profit. A combined ratio of more than 100 per cent reflects a loss.
Initial reports summarising the first half of 2015 from UK insurers show that, on average, combined ratios continue to improve. A small number of catastrophic losses for the remainder of 2015, as well as new methods of synthesising and analysing consumer data, will likely lead to reports of improved combined ratios again in Q1 of 2016.

Investment Holding

Another way insurers make money is by investing policyholder surplus and cash reserves in the stock market as well as a variety of other investment vehicles. If investment returns are good, the insurer makes money.
Many UK insurers continue to report dwindling investment yields due to low interest rates, stemming from the United Kingdom’s sluggish but persistent economic growth since the 2008 financial crisis. In response, insurers are aiming to shift, grow and diversify their investment portfolios, reflected in the graph below.

 

 

Increasing interest rates 

Interest rates in the United Kingdom have been kept at historic lows since the aftermath of the financial crisis. But as economic recovery gains momentum, analysts are anticipating a rate hike sometime between the first half of 2016 and 2017. Rising interest rates are generally considered a sign of a strong economy, yet opinion remains varied on how rising interest rates will affect financial markets.



Contact us to learn more of insurance industry news


 

The Benefits of Early Intervention

Supporting employees when they need it the most.

Every business experiences sickness absence. An effective wellbeing strategy can help your staff stay healthier and help you better manage sickness absence. But there is no way to eliminate it completely – especially when it comes to serious illness or injury. While most companies know their sickness absence costs, many are unaware of how much they could save by stepping in early.

A recent report by the Centre for Economics and Business Research (Cebr) reveals that long-term sickness absence (6 months or more), costs UK businesses £4.17bn every year. This means it’s costing a typical business of more than 500 employees over £770,000 a year. It’s also a growing problem. As the make-up of the workforce changes and the number of older employees grows, this will only increase.

However, by providing access to support early on and proactively using early intervention services, businesses can reduce the length of a typical absence by 17%. For mental health conditions, the most common cause of absence, this rises to 18% - meaning an absence of 7 months would be reduced to 6 months.

The cost of long-term sickness absence

Key findings

To the economy as a whole (public and private sector)                               £6.71bn

To your business*                                                                                                £770,000

Per employee*                                                                                                    £208

To UK business                                                                                                     £4.17bn

(*more than 500 employees)

 

The cost of mental health

With an estimated 3 in 10 fit notes issued by GPs concerning mental ill health (CIPD, 2014), it’s no surprise that mental illness, including stress, is the most common and costly cause of sickness absence – amounting to a £1.17bn, a quarter of the total cost of long-term sickness absence.  It’s where early intervention services have the greatest effect – shortening the length of mental ill health absence by 18%. By spotting the early signs of mental illness in the workplace, employers can start conversations with employees and put relevant support in place – sometimes even before an employee goes off sick.

Courses such as Mental Health First Aid can help HR and line managers learn how to deal with mental health in the workplace. Other services such as Employee Assistance Programmes and Cognitive Behavioural Therapy can give employees access to tools to help them cope with or control their condition.

A growing problem

The cost of long-term sickness absence is rising - increasing by £240m over the last 2 years. And, as the make-up of the workforce changes and the number of older workers increases, it’s likely the cost will reach £7.6bn by 2030 – an increase of £890m. Employers clearly need to take action and think about not only prevention, but how they can step in to provide the support their employees need to address their illness while still in its early stages.

Sickness absence costs UK businesses £4.17bn every year. A quarter of this cost (£1.17bn) is due to mental ill health. Early intervention services reduce sickness absence by 17% - a reduction of more than an entire year for the average long-term absence of 7 years.

Group Income Protection policies with early intervention services offer businesses significant savings. For every £100 an employer spends, they get an average payback of £61. If employees actively use the services on offer, this increases to £66.

 

What can businesses do to support their employees?

To minimise the likelihood and cost of sickness absence to your business, putting a health and wellbeing strategy in place is key. While prevention is typically the focus, intervention is just as important - providing services which allow employers to step in when employees show the first signs of a health problem.

A variety of intervention services are available to employers and employees - often included as part of a Group Income Protection package.  Support on offer can range from “self-serve” information online, to telephone support, face-to-face counselling and absence case management.

Early intervention services you can use:

Employee Assistance Programmes (EAPs)

Access to information and support on work/life issues – including legal matters. Some EAPs also offer counselling services for distressed employees.

Early intervention

• Helpline

Information for employers on how to best support an absent employee – or a struggling employee in the workplace who is likely to go off sick.

• Cognitive Behavioural Therapy (CBT)

Helping employees to rethink the way they behave in certain circumstances such as anxiety or depression.

• Vocational rehabilitation services

A team of experts offering support to employers and employees – including active case management and return to work guidance. Access to rehabilitation support in the first 6 months of an absence could even help employees return back to work before they become long-term absentees.

• Mental Health First Aid

A 2-day course helping employers learn how to spot the signs of mental health issues in the workplace and how best to support employees quickly and confidently.

• Positive ageing guidance

Information and support for employees around ageing and caring for elderly family members.

• Physiotherapy

Helping employees to manage pain and introducing treatments to aid recovery.

Sources:

“The Benefits of Early Intervention” by Centre for Economics and Business Research, commissioned by Unum (October, 2015)

CIPD Absence Management – annual survey report (2014)

 

The bottom line

Not only is use of early intervention and rehabilitation services driving down the typical length of long-term absence, it is also generating an additional £270m worth of ‘payback’ to UK businesses. This can mean significant savings for companies. In fact, for every £100 you spend on a Group Income Protection policy with early intervention services, you get an average payback of £61 – the result of savings on replacement salary costs, less impact on productivity, and a reduced need for recruitment and training of new staff. If an employee actively uses the intervention services on offer, this payback increases to £66. 

It’s clear that ensuring your employees are healthy and happy isn’t just the right thing to do, it directly impacts your bottom line.  Smart businesses should consider how they can provide their employees with early intervention services, such as those you receive as part of a Group Income Protection plan. Even more importantly, they should ensure their employees know about the services available and take full advantage of them.

To read the full report, go to: unum.co.uk/early-intervention

(With thanks to Unum for their kind permission to reproduce this article)

 

If you would like to find out more about the benefits of a Group Income Protection scheme for your business, please contact:

Richard Birch FCII APMI APFS DipIEB

Chartered Insurance Practitioner

Director - Employee Benefits

In2 Matrix (UK) Ltd

101 Finsbury Pavement

London
EC2A 1RS

Tel DDI     +44 (0) 203 638 5159

Email      richard.birch@in2matrix.com

Website: www.in2matrix.com