Corporate Catastrophe Cover

Overview:  If there are multiple deaths in a single event, death in service benefits that have been capped may not pay out as much as is needed. No one can stop a catastrophe from happening, but AIG UK Corporate Catastrophe Cover will pay the amount over and beyond the capped benefit limit up to the catastrophe limit selected and stop it having a catastrophic effect on a company’s finances.

Who is it for?:  Larger UK businesses.

Why Corporate Catastrophe Cover is important: Terrorist attacks, natural disasters and the possibility of Nuclear, Chemical and Biological attacks have a potential impact on death in service benefits – and the employers that provide them.

Death-in-service benefits are designed to deal with individual cases of accidental or natural death - not cover a major event or catastrophe that affects a large number of employees in a single incident.

Many companies are now having their death in service cover limited, in response to these far larger risks. As a result, many pension funds may now have inadequate cover and could face a multi-million pound exposure to fund pensions benefits – with pension fund trustees and brokers being held accountable for not maintaining sufficient protection.

A better outcome if the worst happens: 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 three times salary, or in this case £150,000 per individual with a limit of £50million. On this one city site alone there could be an exposure of £75 million, considerably more than the capped amount.

AIGUK Corporate Catastrophe Cover will bridge the gap and cover the difference, preventing a major strain on the company’s financial position.