"Providing employees with some basic financial protection would be a move in the right direction. If this were provided as some form of medical cover, this would reduce some of the burden on the NHS. It may also have a positive effect by reducing the cost of state benefits."
Robert Harvey, independent protection expert at Drewberry, said: "We'd always welcome stronger moves by the government to get valuable protection to more people, just as the state has legislates that people must insure their cars and, more recently, save into pensions via auto-enrolment."
He pointed out there is a "worrying protection gap out there", with Drewberry's recent survey finding just 6.2 per cent of people had income protection, despite also having limited savings.
Mr Harvey added: "If protection is to be offered by employers then employee benefits have been shown to be highly valued by employees, improving staff retention and reducing absenteeism.
"However, it's important to note that group protection products already have a number of tax benefits and incentives, yet these alone haven't improved take-up of these products."
simoney.kyriakou@ft.com
