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By African Unity Life

Fri, 22 Mar 2019
African Unity Life

When it comes to group scheme insurance, not only do the employees benefit, but there are also a host of benefits for the employer such as tax benefits and knowing you have you a motivated, healthy workforce. Not only do your employees have peace of mind for their and their family’s wellbeing and financial future but offering employment benefits to your workforce is seen as a drawcard and a reason to stay.  

Types of group insurance offerings

The great news is that you can tailor your group benefits to your industry and what your employees need and can afford. There are three main types of employee benefits that we’ll explore, and they fall into the categories of Risk, Investments and Healthcare. 

Group risk product options

Risk products are a practical and common group scheme offering with an array of products that an employer can select from:

Group life cover

Life cover, normally a mandatory option, if offered to employees provides peace of mind to family members that they can cope financially should anything happen to the life insured (employee). Some companies will include this as part of your cost to company, while others will share the costs with employees. Usually, the insured value that an employee qualifies for will be based on their position and a multiple of their annual earnings. When group life cover is offered, companies might not offer you a funeral cover option as many life policies now include an ‘immediate’ release of funds to cover these expenses.

Disability and Dread disease cover

These are ancillary products that can be added to your group life cover. It’s worth understanding if the disability cover offered is a lump sum or monthly payment option. If it’s the latter, you’re generally covered between 70-80% of your monthly salary, should you be permanently disabled until retirement. Lump sum disability will pay you a percentage of the 100% you are insured for, dependent on the extent of the disability. This also applies to how dread disease cover works, commonly known as critical illness cover.  

Group funeral cover

A group funeral insurance offering can also be tailor-made to the employer. This extends to the amount of funeral cover and who’ll be covered by the policy. An employer can offer cover amounts such as R5 000 or R10 000, which will come with a fixed premium amount per cover, regardless of the employee’s position or age. Most group funeral policies will offer cover for immediate family - spouse and children - as well as extended family, but it’s not always the case. Additional benefits can also be added such as repatriation, grocery or airtime benefits, but the more basic the cover, the more cost effective. 


Companies offering investment options in the form of group retirement funds are seen as leaders within industry as South Africans are known to be poor savers and this way responsible investment behaviours can be instilled. 
Retirement options

Provident fund

Provident funds are common when being offered group investment options nowadays. Most of the time it’s a mandatory offering by companies but the flexibility comes in regarding the percentage of your monthly salary you’d like to invest, ranging from 5-20%. To keep costs low, your funds will also be placed in an umbrella fund, this means that many companies join one investment fund as opposed to a specific fund being created for a single company. Another investment option available is ‘life stage portfolios’; where dependent on your age and risk profile, you’ll automatically be allocated to a portfolio. Either way, this offers great tax benefits, and should you resign before retiring, you can preserve the funds, transfer to your new employer’s provident fund or take the amount as a lump sum, but it will be taxed heavily. 

Pension fund

Pension funds are offered by more established corporations, but the principles of provident funds apply, with the greatest difference being the accessibility to your funds. If you resign, you will only have access to one-third of your funds, where the remaining must provide you with an income during retirement, so will need to be preserved. 

Retirement annuity

Generally taken out in one’s own capacity and where you have complete control on how you’d like to invest your contributions, subject to limits set out by retirement fund regulations. 


Having healthy, productive staff is the cornerstone of any successful business; which is why group health insurance is offered by most companies. 

Medical aid

Once again, a mandatory group cover option, where you can be presented with options of medical aid companies that the employer works with, should you not have one in place already. The onus is on you to do your research on which company you’d like to deal with and what type of plan you’d like, i.e. comprehensive cover or a hospital plan. Once more, companies might include this as cost to company or offer to pay up to 50% of the premium on your behalf. You can normally add your dependants which might work out more cost effective. 

Gap cover 

If gap cover is offered as part of your group healthcare options, you need to belong to a medical aid to take this as supplementary cover. It covers the gap owed, as with medical aids there tends to be shortfalls, which can put a strain on your budget. Under group cover you will also generally get a better premium for gap cover. 

Health insurance – Hospital cash back

Health insurance is not a medical aid and is cheaper, making it a more attractive option as a group medical cover, where employees are earning in the lower to medium income levels. It provides for hospital cover, day-to-day benefits, and medical costs incurred. There’s also a set daily cash back amount paid out for each day you’re in hospital. African Unity Life offers one of the most affordable options, providing cover for individuals or families. The hospital cover option covers several serious illnesses, maternity, accidents, ICU, chronic illnesses with medications and also dread diseases.

Employee benefits are imperative for both employers and employees and should not be overlooked. With the many options available, companies can truly find a solution that fits their unique needs to support and empower their employees. African Unity Life offers a range of affordable group employee benefits, namely: 

If you are looking for cost-effective, holistic group employee benefits and a partner for your business do not hesitate to contact us.