Overview:  Provides significant event limit benefits for organisations with employee benefit payment aggregations exceeding the cap placed on their pension scheme death in service cover

Who is it for?:  Larger UK businesses.

It’s difficult to stop catastrophic events from happening.

But it’s easy to stop them having a catastrophic effect on company finances.

Consider recent events. Terrorist attacks, the possibility of Nuclear, Chemical and Biological attacks. Not to mention political unrest and an increase in natural disasters. Pension funds provide death-in-service benefits that are designed to deal with individual cases of accidental or natural death. What they are not designed to do, however, is cover a major event or catastrophe, one that impacts a large number of employees in a single incident. There are now regular cases of multiple casualties, requiring much bigger payouts.

Exposure is growing. Are you at risk?

In response to these far larger risks, many life insurance companies are now limiting cover for pension funds at around £25 - £35 million. The result? Many pension funds may now have inadequate cover and could face a multi-million pound exposure to fund pensions benefits. Pension fund trustees and brokers could be held accountable for not maintaining sufficient protection. It’s not a situation you want to find yourself in.

Peace of mind in times of trouble

While £35 million may seem a lot, in many cases where there are multiple deaths in a single event, life insurance companies would not pay out as much as is needed. That’s why AIG UK Corporate Catastrophe Cover is vitally important. Take a city institution based in Canary Wharf , with 500 employees on a single site with an average salary of £50,000. Typically death-in-service benefit will amount to four times salary, or in this case £200,000 per individual. On that one city site alone there could be an exposure of £100 million, requiring £65million over the capped amount.