Critical Illness Cover for UK & Irish Teams
Group critical illness cover provides a tax-free lump sum following a serious diagnosis. Kota helps you compare insurers, set up cover, and manage everything in one system with HRIS sync. No spreadsheets. No manual updates when someone joins or leaves.
About
Group Critical Illness Cover
What is Group Critical Illness Cover?
Employees can use the lump sum payout however they need, whether that’s covering medical costs, paying their mortgage, childcare, or taking time away from work while they recover.
It's set up as a group policy. That means your entire workforce is covered under a single scheme rather than individual plans. Employees don't need to go through personal underwriting to join.
Critical illness policies cover between 20 and 40 conditions, depending on the insurer and level of cover you choose.
Group Critical Illness Cover
vs. Group Income Protection
Income protection replaces a percentage of your employee's salary on an ongoing basis if they're unable to work due to illness or injury. Critical illness cover pays a one-off lump sum triggered by a specific diagnosis, regardless of whether the employee is still working.
They're complementary benefits, not alternatives. Many employers offer both as part of a complete protection package.
Policies commonly include:
-> Cancer
-> Heart attack
-> Stroke
-> Multiple sclerosis
-> Organ failure
-> Major organ transplant
Why offer Group Health Insurance?
Here's why more employers are adding it to their benefits package:
Provides financial support when it matters most
- Covers costs that income protection doesn't: mortgage arrears, medical expenses, or one-off financial commitments
- Pays on diagnosis, not after a deferred waiting period
- Lets employees decide what they need most
Complements your existing protection benefits
- Pays a lump sum on diagnosis rather than monthly income replacement
- Bridges the gap between illness, long-term absence, and worst-case scenarios
- Strengthens the overall financial protection your benefits package provides
Delivers strong protection at a manageable cost
- Premiums are based on group rates, making it more affordable than individual policies
- Cover levels can be tailored to your budget and workforce size
- Adds real value to your benefits package without a substantial cost increase
Gives employees greater peace of mind
- Provides financial security during a difficult time
- Helps employees focus on recovery rather than financial pressure
- Demonstrates your commitment to employee wellbeing
How Group Cricital Illness Cover works
Here's what the process looks like from setup through to payout.
Choose your cover level
Decide how much financial protection you want to offer. Most employers choose either a fixed benefit amount - commonly between £25,000 and £50,000 - or a multiple of each employee's salary. You'll also set eligibility rules, such as whether cover applies from day one or after a probation period.
Compare providers and get quotes
Insurers vary in the conditions they cover, medical definitions, and payout structures. To get quotes, you'll need basic workforce data: headcount, age distribution, and salary information. Traditionally, this is handled by a broker, who approaches insurers on your behalf.
Enrol your employees
Once you've selected a provider, your employees are enrolled onto the scheme. Each employee receives confirmation of their cover and what they're protected against. You don't need individual medical underwriting for each person. Group policies cover your workforce under a single scheme.
A diagnosis triggers a claim
If an employee is diagnosed with a covered condition that meets the insurer's policy definition, a claim can be made. Most policies include a survival period of 10 to 14 days following diagnosis. Either the employer or employee notifies the insurer within three months and submits the required medical evidence.
Lump sum is paid directly to employee
Once the claim is approved, the insurer pays a tax-free lump sum directly to the employee. There are no restrictions on how it's used. As the employer, your role at this stage is about ensuring your policy remains compliant, including maintaining the minimum number of lives insured required by your provider.
Set up Group Critical Illness Cover in minutes
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Who offers
Group Income Protection?
How much does
Group Critical Illness Cover cost?
The cost of group critical illness cover depends on several factors specific to your workforce and the level of cover you choose. Premiums are calculated at a group level, which makes it more affordable than individual policies your employees could take out themselves. There's no single price, but understanding what drives the cost helps you make informed decisions about cover levels and budget before you approach insurers for quotes.
These key factors influence the cost of your premium:
The size of your workforce
If your company has a smaller workforce, premiums may be slightly higher as the risk is concentrated across fewer employees. Most providers require a minimum number of employees to qualify for a group scheme, usually between three and five lives.
The age profile of your workforce
Older workforces are more likely to make a claim, which insurers reflect in higher rates. If your team skews younger, you'll generally pay less.
As your workforce ages over time, expect your premiums to adjust at renewal.
Your cover level
Most employers opt for either a fixed lump sum or a multiple of each employee's salary.
The higher the cover level, the higher the premium. Some employers offer different cover levels by seniority or role type, which can help manage overall cost while still providing meaningful protection.
The conditions covered
How strictly each condition is defined affects the likelihood of a successful claim, which in turn affects pricing. Broader coverage with clearer definitions generally comes at a higher premium but provides more certainty for your employees.
Your industry and occupation risk
Desk-based roles in tech or professional services are rated lower than manual or high-risk occupations, which translates into lower premiums.
If your workforce includes a mix of office-based and field-based roles, insurers may apply different rates across employee groups.
How cover is funded
Employer-funded cover is the most common approach and typically attracts better group rates.
Voluntary schemes can reduce the cost to the business but may result in lower take-up, which can affect the overall risk pool and pricing.
Example scenario
A tech company with 50 employees, averaging 32 years old, opts for a fixed benefit of £50,000 per employee.
Based on typical group rates for a younger, desk-based workforce, the annual premium could range from roughly £3,500 to £6,500 or around £70 to £130 per employee per year.
That's meaningful financial protection for your team at a manageable cost to your business.
Tax implications of
Group Critical Illness Cover
United Kingdom
Employer Treatment
Employee Treatment
P11D / BIK Notes
Ireland
Employer Treatment
Employee Treatment
Revenue / BIK Notes
What you need to set up
Critical Illness Cover
Setting up group critical illness cover usually requires a few key details about your workforce and the level of protection you want to offer. Insurers use this information to assess risk and provide quotes for your company.
You’ll need to provide:
Number of employees
Salary information
Employee ages
Cover level
Eligibility rules
Industry and role classification
How Kota handles
Group Critical Illness Cover
Many employers manage critical illness cover through a traditional broker - a separate relationship on top of whichever benefit platform or HRIS they're running. Kota replaces that fragmented setup with a single system that handles everything via API connections.
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Frequently asked questions
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The cost depends on several factors including your workforce size, the average age of your employees, your chosen cover level, and the conditions included in the policy. Premiums are calculated at a group level, which makes them more affordable than individual policies.
Yes. It's often more affordable than smaller employers expect. Group rates apply even to smaller teams, and the perceived value to employees is significant.
For a relatively modest annual premium, you're offering your team meaningful financial protection against some of life's most disruptive events. It also strengthens your benefits package in a competitive talent market without a substantial cost increase.
Employer-paid premiums are treated as a benefit in kind. Employees pay income tax on the value of the premiums. In the UK, Class 1A National Insurance contributions also apply for the employer.
However, the lump sum payout an employee receives on diagnosis is tax-free. It's worth communicating this clearly to your team so they understand the tax position before they need to make a claim.
A claim can be declined if the diagnosed condition doesn't meet the insurer's specific policy definition, even if it falls within the general category of covered conditions. This is why policy definitions matter when comparing providers. Broader, clearer definitions reduce the risk of a disputed claim.
Insurers may also decline claims if the condition was undisclosed at the time the policy was set up, though group policies generally don't require individual medical underwriting.
Cover ends when an employee leaves the company. They are removed from the group scheme and are no longer protected under the policy. Some insurers offer a continuation option, allowing departing employees to convert to an individual policy without further medical underwriting, though this varies by provider.
From an employer's perspective, keeping your policy accurate when employees leave is important to avoid paying premiums for people who are no longer on your payroll. Kota handles this automatically. When an employee is removed from your HRIS, they're offboarded from the policy in real time, so your coverage and costs stay accurate without any manual intervention.
Modern benefits management starts here
Benefits you and your employees will love using
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