By Sam Barrett 16 November 2017.

Group risk products deliver benefits to employees and employers alike. But, with the state pension age (SPA) increasing, employers must ensure their policies are compliant or risk additional expense and legal action.

The current SPA is 65 for men and is gradually increasing from 60 to 65 in November 2018 for women. It will increase to 66 for both men and women by October 2020, and further increases are planned to raise it from from 66 to 67 between 2026 and 2028.

When the default retirement age was removed in 2011, rather than face a potentially open-ended liability, an exemption was secured for group risk products. This allows cover to cease at the greater of age 65 or SPA. Katharine Moxham, spokesperson at industry body Group Risk Development (Grid), explains: “Employers must ensure the benefit termination date on group risk policies is stated as 65 or SPA, if later. Without this, they are potentially exposed to uninsured liability for benefits that arise after the age specified in their cover.”

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