Disability Management in the U'K'

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Disability Management in the U.K.

• Joy Reymond - Head of Rehabilitation Services
• UnumProvident
• IFDM Conference October 2006

UnumProvident is not authorised to give you
advice. Should you require any advice you should
seek this from your IFA. The material contained
in this presentation applies only to
UnumProvident and its products Unum Limited,
trading as UnumProvident, is authorised and
regulated by the Financial Services Authority.
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Our Company Profile

• We specialise in long-term income protection
  insurance (GIP) paying the salary of those who
  are unable to do their job for extended periods
  due to illness or injury
• We are a significant provider of GIP in the UK
• Unlike our competitors we focus on rehabilitation
  and return-to-work, with a team of in-house rehab
  staff this has contributed to our success

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Our Company Profile

• We specialise in long-term income protection
  insurance (GIP) paying the salary of those who
  are unable to do their job for extended periods
  due to illness or injury
• We are a significant provider of GIP in the UK
• Unlike our competitors we focus on rehabilitation
  and return-to-work, with a team of in-house rehab
  staff this has contributed to our success
• GIP is profitable, but few employers purchase
  this kind of insurance
• Just 6 of UK employees have income protection
  cover so what about the rest?

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The Health of the U.K Workforce

• 30 Million in employment
• 2.3 2.8 million people are on some form of
  incapacity benefit
• Annual cost of these benefits 12.5 Billion
• 1.4 - 1.8 Billion paid annually in Employers
  Liability premium
• IN ADDITION
• Estimated cost to business of employee absence is
  13 Billion

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The UK Approach to Short Term Absence

• The employer and employee foot the cost for most
  short term absences
• The costs for the 1st 6 months are therefore
  largely hidden in fixed payroll and individuals
  lost salary
• Employers obligated to pay 70.05 per week from
  day 4 to 28 weeks
• Many employers elect to pay part or all of the
  top-up to regular salary

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The U.K. Approach to long-term absence

• After 28 weeks, Government pays an incapacity
  benefit (IB) to those too ill to work 59.20
  78.50 per week up to approx. 10K per year
• After a year, IB recipients are more likely to
  die than return to work
• In the past, Pension Funds would sometimes
  provide an ill-health early retirement pension,
  but this is now rare
• Most still rely on the very low rates paid by the
  State and only realise how low it is when it is
  too late
• The Government is trying to reduce its payments,
  by getting claimants back to work and preventing
  new cases.
• Roll-out of this new approach is being outsourced
  are these private providers trained, competent,
  capable, or even available?

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The U.K. Legislative Framework

• No German/Canadian style Workers Compensation
• Industrial Disease Legislation is very narrowly
  defined
• Compulsory Employers Liability Insurance
• Tort-based must prove employer negligence, so
  claims numbers quite restricted
• Most awards are single payments of less than
  10K, typically paid 2 years after the fact.
• Rehab is an after-thought in most cases insurers
  are uncertain what it can do and whether it can
  be effective
• Little support or assistance to stay in work or
  return to work

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Illness, Injury Absence from Work

• Growing awareness of the biopsychosocial model
  and its relevance to sickness absence
• Increased understanding that absence is not
  strictly a medical issue, and that absence
  management is key
• BUT medical topics are still awkward subjects of
  conversation for most employers/managers
• HR staff often not equipped/trained to manage
  absences effectively

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The Traditional Insurance System Responds
Compassionately to Severe and Incapacitating
Illnesses

• E.g. Cancer, Heart Failure and Stroke
• Focus is on the claims management to allay
  financial worries

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But Most Sickness Absence is due to Common Health
Problems

• Often, their symptoms are not that different to
  those still at work
• The cause of absence is frequently the
  combination of medical with social and
  organisational issues, both at home and in the
  workplace
• Impact on the employee of being off work can be
  profound
• This is a significant opportunity for Vocational
  Rehabilitation

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Our Income Protection Model

• Identifying or apportioning blame is not an issue
• Medical diagnosis is not always the key
• Capacity to work is the focus

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Early Intervention is our Window of Opportunity

• Capture the moment?
• If we leave it to fester, then ..

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So Why isnt Early Intervention Happening more
Often?

• Our HR Procedures and how we administer Statutory
  Sick Pay
• The Structure of the typical income protection
  insurance policy focus on long-term payments
  rather than pro-active intervention to prevent
  long term absence
• Inertia / Conservatism

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UnumProvidents New Venture into Absence
Assessment

• First, build awareness via NIDMARs CBDMA a
  comprehensive assessment of the employers
  overall approach to absence
• This is exclusively offered to our customers
• Market this as a USP of being a UnumProvident
  customer
• The assessment will have a knock-on effect of
  improving their performance in managing absence

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UnumProvidents New Venture into Absence
Management Training

• WHY
• VR is not a recognised profession in the UK
• There are no professional standards,
  qualification, or accreditation for VR
• Most practitioners rely on their OT, nursing or
  psych or similar qualifications
• No Consumer Protection

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How will it Work?

• A consortium of universities across England,
  Wales and Scotland will deliver the courses
• We are supporting the Anglicisation of the
  material
• Our role is to promote the value of this
  foundation training material
• Promoting the creation of a Rehab Council to set
  standards, accreditation and regulation
• In 2007, we hope to introduce the first
  Certification Exam!

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The UnumProvident Vision