Parsonage’s view on Death in Service

Two things to consider:

1. What is death in service (DIS)?

2. Why provide it for your staff?

So, what is death in service?

DIS is life insurance that pays out a lump sum to your beneficiaries if you die whilst working for a particular employer. 

It is a benefit employers can choose to provide their staff on top of their pay. Often the first staff benefit considered by employers, it is easily accessible and relatively inexpensive compared with other benefits. Furthermore the perceived value by the employees, in our experience, is greater than the cost. 

Think about your staff, who doesn’t have a family, a mortgage, credit card debts, dependents and so on? I would wager not many. 

This is why providing life cover to your staff in a great benefit to offer to improve you remuneration package. 

The first thing we are always asked ‘do you have to die at work?’

It’s a fair question, and the good news is no, you don’t just whilst employed. 

So, it’s life cover, what is so great about that?

1. The premiums are a cost to the business

2. There is no tax to be paid on the premiums

3. There is no tax to be paid on the benefit

4. There is no tax to pay in the event of a claim

All in all it is a very efficient way of offering an extra benefit to you staff to try and improve the remuneration package you offer, which in turn will hopefully lead to better recruitment and retention of great staff. 

So how much cover should you offer? It varies massively from company to company depending on the budget you have to provide such cover. It is common to select a fixed amount, £50,000 or £100,000 for example, or to choose a multiple of salary so the benefit is inline with the pay you award an individual member.