Well-being requires a dialogue across the organisation, involving risk managers, human resources and employee benefits professionals, as well as corporate social responsibility, occupational health, treasury and legal experts, writes Timothy Smith, Senior Underwriter – UK Casualty – Retail at AXA XL

Wellbeing is a concept that is growing in importance for employers across the UK. A workforce that is healthy, both physically and mentally, is a more productive one. And risk managers have an important role to play in helping their organisations to achieve this goal, while reducing costs over the longer term.

The Chartered Institute of Personnel and Development (CIPD) says that good health and wellbeing is a “core enabler” of both employee engagement and organisational performance. It is certainly true that for employees – notably the millennial generation – it is increasingly important to feel that wellbeing is a key part of their employer’s strategy.

While anecdotal evidence suggests that companies are keen to embrace wellbeing, one of the challenges faced by risk managers and others concerned with improving employee wellbeing and reducing absence is getting the issue on to the board’s list of priorities.


In a 2018 study, the CIPD found that employee wellbeing was on the agenda of senior leaders in 61% of companies surveyed – up from 55% in 2017. This is hugely encouraging, but there is clearly still some way to go to advance the topic.

Nevertheless, it is possible to demonstrate the financial benefits of a wellbeing strategy. This, we hope, can give risk managers added clout when trying to persuade senior management that, as well as making employees – both current and future – feel more engaged, there is a way to reduce the bottom-line costs caused by ill-health and injury. Money talks, as they say.

According to the Health and Safety Executive (HSE), 1.4 million people in the UK suffered from a workplace illness in 2017/2018. Workplace injury and new cases of work-related ill-health cost employers about £3 billion in the 2017/2018 period, the HSE said.

Research by the CIPD shows that health and injury problems that result in absence can cost businesses up to £557 per employee per year.

Introducing a holistic wellbeing policy can help to substantially reduce those costs.

Take the example of a general manufacturing company with 10,000 employees. According to the CIPD, the average annual absence per employee is 6.6 days a year. Musculoskeletal-based absence would cost that company about £180,000 a year and mental health-related absence about £104,000. On the other hand, the cost of engaging a clinical employee services provider for musculoskeletal rehabilitation support might be in region of £70,000 per year.


There are less tangible benefits too. Companies can significantly boost recruitment and retention efforts by putting in place a programme that makes their employees feel that not only will every effort be made to safeguard their physical and mental health while at work, they will be supported throughout their recovery and back to work should something go wrong.

As the UK economy has shifted to become more service-based, so mental health issues have become a larger factor in workplace absence. This requires a more nuanced approach than simply paying a valid claim.

A holistic programme that aims both to enable employees to feel supported through mental health difficulties and rehabilitate them back into the workplace provides many benefits, including financially and in terms of employee loyalty and engagement.

This strategy requires a broad way of thinking. It cannot be done in siloes. A holistic approach to well-being requires a dialogue across the organisation, involving not just risk management departments, human resources and employee benefits professionals, but also taking in corporate social responsibility, occupational health, treasury and legal experts among others.

This also requires a long-term mindset. The financial and productivity benefits of a holistic wellbeing programme are in themselves long-term and the risks of employee ill-health and injury typically are long-tail.

An important element of making a holistic wellbeing approach a success is developing a relationship with an insurer that has expertise beyond the purely transactional. An insurer that works with a specialist occupational rehabilitation provider can give clients access to a much broader toolkit to get employees back to work and healthy.

This is much more of a partnership approach that requires a dynamic dialogue between insurer and client.

Health and wellbeing is a key topic at this year’s Airmic conference and we look forward to having this dialogue with many of you here in Harrogate and beyond.

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