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Employee Benefits Magazine - Group life insurance pays out £93m in employee-related Covid claims

New data has revealed the extent to which group life insurers have paid out claims related to the deaths of employees due to Covid-19 (Coronavirus).

According to figures released by Group Risk Development (Grid) for the year to 31 December 2020, payouts were given to the dependents of 891 employees with group life benefits who died due to Coronavirus.

The total cost of these payments, where primary or secondary cause of death was registered as Coronavirus, came to £93 million – representing an average lump sum death benefit payment of £100,320, with the average capitalised value of the dependants’ pensions being £617,771.

But according to Grid, the real number of payments is likely to be nearer 1,000 (or around 14% higher), as there is typically a delay between the date of death and date of payment.

Moreover, Grid believes the figures for 2021 could be even higher still, as the impact of the second wave of deaths throughout the winter of 2020 in the UK were not fully captured by the current published figures.

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