Drawing from a panel discussion at our annual Through the noise retirement benefits conference in September, Ielyaas Gamiet, manager in the Group Savings and Investments team, highlights the role of group risk in the broader structure of an employee’s benefits suite.
Structuring a compelling employee benefits package for staff is no easy task. A sound benefits structure includes protection and planning pillars, which can be achieved through financial products such as group risk, medical aid and retirement savings, to name a few. These benefits promote physical and financial well-being and can help improve staff loyalty and retention.
This piece homes in on group risk, focusing on what group risk is and why it matters.
What is group risk and why does it matter?
Group risk benefits are employer-endorsed (and sometimes sponsored) insurance products designed to protect employees and their families from the impact of significant life events such as death, temporary or permanent disability, or severe illness.
Given that working South Africans are often underinsured, this is an important pillar of employee benefits. Group risk is generally more affordable than individual cover and provides security and peace of mind to employees.
Group risk benefits typically offer cover without medical underwriting, known as a proof-free limit, that can be converted to individual policies at exit or retirement – often at a lower cost.
Why are working South Africans underinsured?
There are various contributing factors to the issue of underinsurance among employed South Africans, including affordability barriers, a deficit of trust in the industry and a lack of understanding about the value and purpose of insurance. This last factor was highlighted in a Sanlam study, which revealed that group risk remains the least understood category of employee benefits.
How to approach group risk
At Through the noise 2025, we explored how group risk is perceived and approached, and where it fits into today’s employee benefits ecosystem. Below are some of the key reflections from the panel discussion that can inform how to think about group risk benefits.
1. Approach group risk from a partnership lens
Group risk offers more than individual protection: it is also a form of community support. As Old Mutual’s head of Customer Proposition: Group Assurance Products, Brice Salence Nunes, stressed, many employees support extended households and may not easily afford individual cover, making group risk insurance vital. In addition, San-Marié Crause, managing executive: Group Risk at Sanlam Corporate, highlighted the need to shift from a commoditised approach to one rooted in partnership – where, beyond pricing, data insights, long-term thinking and relationship-building guide group risk decisions.
2. Focus on critical illness
Cancer-related claims are on the rise, with Sanlam reporting that cancer accounts for around 20% of disability claims and approximately half of severe illness claims. However, severe illness benefits make up only 3% of total group risk premiums. This mismatch clearly highlights a coverage deficit, leaving many employees financially vulnerable when they need the most support, and underscores the importance of reassessing benefit structures to better reflect evolving health risks.
3. Understand the impact of lifestyle trends
Rudi van Rooyen, executive head of Actuarial at Hollard Insurance, noted that obesity rates in South Africa have surged, with studies showing they have doubled in the past 25 years and tripled in the previous 50 years. He cited a recent Human Sciences Research Council (HSRC) study that revealed that nearly 50% of South Africans have been classified as obese or overweight, which is linked to the heightened risk of developing chronic conditions such as hypertension, diabetes and mental illnesses. If not addressed or managed correctly, these issues could affect both employer productivity and employee financial well-being.
Old Mutual’s Nunes added that while HIV- and AIDS-related deaths have declined, recent cuts in donor funding from the United States Agency for International Development (USAID) may reverse progress, increasing tuberculosis (TB) cases and disability claims.
All three panellists emphasised the growing need for employers to actively support employee health through education, awareness and integrated benefit strategies that work to solve the funding gap.
Every pillar has its place
A clear message emerging from the discussion is that group risk benefits are critical to financial and social security. Like retirement savings, they provide employees in South Africa with access to financial products that many may not be able to afford on their own.
The panel’s insights on claims trends illustrate the need for employers to support a healthy, productive workforce by adopting integrated employee benefit solutions that address the physical, financial and emotional well-being of their employees.
Balancing affordability, optimal benefit coverage and costs remains a challenge, but it is a long-term journey. With strategic commitment from employers, quality guidance from consultants and advisers, and forward-focused products from providers, group risk can evolve from a quiet pillar into a cornerstone in the architecture of employee financial resilience and security.
The Allan Gray Umbrella Retirement Fund (the Fund) offers approved risk benefits, and employers have the flexibility of choosing their own unapproved risk benefits.
For approved risk benefits, the Fund has been issued with an insurance policy, based on a master policy, by four insurance companies – Sanlam, Hollard, Old Mutual and Capital Alliance – with a separate agreement with Momentum and Discovery also in place. Our proposal process ensures that employers and their employees enjoy the benefit of having approved risk benefits automatically placed with the insurer who offers the most competitive premium based on the same terms and conditions.
For unapproved risk benefits, employers can choose unapproved risk policies with any insurer. Allan Gray offers to facilitate the payment for unapproved risk benefits, creating a seamless process for the employer that simplifies their payroll administration at no additional cost.