UK Employee Benefits Market: A mid-year reflection on the current trends in 2025

If you’re curious about what’s been going on, here’s a quick snapshot of some of the key trends across four core benefit areas so far this year and the standout companies providing benefits in 2025.

Google

Google has a holistic approach to employee wellbeing, offering up to 24 weeks of paid parental leave, full fertility & surrogacy coverage, & a unique death benefit that pays 50% of a deceased employee’s salary to their spouse for 10 years. Other perks include free meals, on-site healthcare, student loan repayment, and generous support for adoption, mental health, & remote work. These benefits reflect Google’s commitment to supporting employees at every life-stage.

The Body Coach

The Body Coach founded by Joe Wicks, is leading the way in workplace wellbeing with a four-day workweek, flexible remote options, and a strong focus on physical and mental health. Employees benefit from AXA healthcare, 12 weeks of paid childcare leave, and a £500 learning budget. The company also encourages daily movement through Fitness Thursdays and the nationwide Movement Hour 2025, which promotes physical activity during the workday.

Netflix

Netflix has set a new standard for family-friendly benefits with its unlimited parental leave during a child’s first year, giving parents the flexibility to take the time they need. While most employees now take around six to seven months, the policy remains a standout. Additional benefits include global family-forming support for fertility, surrogacy, and adoption; mental health resources; a flexible holiday policy; and compensation tailored to each employee’s market value.

Reflection on more trends in 2025

Group Life

Earlier this year, the Government proposed major changes to the treatment of Death in Service benefits for Inheritance Tax (IHT) purposes. Under the initial proposals, lump sum payments from registered group life schemes—typically exempt from IHT—could have been included in the deceased member’s estate and taxed from April 2027.

However, in a welcome clarification published on 21 July 2025, the Government confirmed that benefits payable from Registered Death in Service Schemes will remain excluded from these changes 

This means that such payments will continue to be treated outside the scope of IHT, preserving their current tax-efficient status.

Despite this clarification, the broader reforms to IHT—particularly the inclusion of unused pension funds and certain death benefits within the estate—have prompted many employers to reassess their benefit structures. Alternatives such as Excepted Group Life Schemes (EGLS) are being actively considered to ensure continued tax efficiency and compliance.

Key Employer Insights from 2025:

• 92% of large employers offer Death in Service benefits as part of their core package.
• 68% of employers are reviewing their scheme structure due to proposed IHT changes.
• 1 in 4 employers are considering switching to Excepted Group Life Schemes (EGLS).

These developments highlight the importance of staying informed and proactive. If you’re unsure how these changes might affect your current arrangements—or are considering alternative schemes—our team at Menzies EB is here to help you navigate the options and ensure your benefits remain fit for purpose.

Group Critical Illness

The Group Critical Illness market has started to settle after a few years of pricing ups and downs. Some insurers are reporting fewer claims – particularly for cancer – thanks to earlier detection and diagnosis, though others are still seeing elevated activity. What’s changing is how employees are using this benefit. It’s no longer just about the lump sum payout – it’s about what that payout enables. Whether it’s funding private treatment, taking extended time off to recover, or making home adjustments, employees are using the benefit to take control of their recovery journey. Many policies also offer support for family members, adding another layer of reassurance. As a result, employers are increasingly integrating Critical Illness cover into broader wellbeing strategies, recognising their role in supporting financial resilience, emotional wellbeing, and peace of mind.

• In 2024–25, 61% of Group Critical Illness claims were related to cancer diagnoses. This marks a slight decrease from 2022, when Unum UK reported that 69% of their claims were cancer related.
• Only 29% of employers have integrated Critical Illness into their wellbeing strategy, according to GRiD.
• In 2024, Aviva reported that the average payout for a Group Critical Illness claim was £72,000.

Group Income Protection

With rising concerns over long-term sickness absence and reduced state disability benefits, Group Income Protection (GIP) is gaining more attention. These policies not only provide a financial safety net – typically up to 75% of salary – but also offer access to early intervention and rehabilitation services. In 2024, the UK group risk industry paid out a record £674.5 million in GIP claims, with cancer and mental health remaining the top causes. Employers are increasingly recognising the value of GIP in supporting both financial resilience and return-to-work outcomes.

• 72% of new GIP claimants returned to work within the same year, thanks to early intervention support.
• The average new GIP claim was £27,630 per year in 2024.
• 50% of early interventions were related to mental health, highlighting the growing need for emotional wellbeing support for employees.