What Are Group Insurance Schemes?
Construction employee benefits are financial protections, such as sick pay, accident coverage, or death-in-service benefits, designed to help site-based workers during periods of illness, injury, or hardship.
Group insurance schemes are often considered the default option for providing employee benefits. These are formal policies purchased from an insurer, offering defined payouts for events like sickness, injury, or death in service. Employers pay monthly or annual premiums, and in return, employees receive cover, typically subject to eligibility criteria and policy conditions.
At first glance, this structure appears straightforward. But in construction, the reality is more complex. Group insurance often involves medical underwriting, long-term contracts, and minimum employee numbers. Insurers may deny claims when employees do not meet specific conditions or when the fine print creates ambiguity.
Construction workforces rarely fit neatly into this model. Teams vary by project. Employment periods can be short. Health risks are higher. These factors often lead to increased premiums or exclusions for higher-risk operatives. Some employers find they are paying for cover that does not fully support their workers when they need it most.
That gap often separates the employer's intention from the actual outcome. The desire to protect staff is there, but the structure of traditional group insurance can fall short. That's why more firms are exploring alternatives, particularly discretionary schemes designed for the realities of site-based work.
Introduction To Discretionary Trust-Based Schemes
Discretionary trust-based schemes offer a more flexible and construction-friendly alternative to traditional group insurance. Instead of paying premiums to an insurer, employers contribute to a central fund. The Board of Trustees manages it. Trustees review claims fairly in accordance with the scheme rules.
Welplan operates on this model. Trustees with industry knowledge and a clear mission manage the fund to support workers fairly and promptly. There are no medical checks. No exclusions based on age or health history. Once an employee becomes eligible through active employment, they are covered.
99% Of Welplan Claims Are Approved, Providing Reliable Support When Workers Need It Most
The keyword here is discretion. Trustees assess each claim on its merits. They apply the rules, but they also recognise real-life context. This approach enables the scheme to provide support in cases where insurers might otherwise decline to do so. It also means that claims can be settled quickly and with less bureaucracy.
For construction firms, the trust-based model makes practical sense. It works with the industry's natural rhythms, short contracts, shifting teams, and site-based risk. It provides peace of mind for workers and predictable costs for employers.
Model Comparison
Group Insurance
Traditional insurance policies are purchased from insurers with defined terms and conditions.
Advantages
- Familiar structure for many employers
- Regulated financial product
- Clear policy documentation
Disadvantages
- Medical underwriting required
- Rigid contract terms
- May exclude high-risk workers
- Less flexible for project-based teams
Discretionary Scheme
Trust-based approach managed by trustees who apply rules with flexibility and fairness.
Advantages
- No medical checks required
- Flexible for changing workforces
- High claims approval rate
- Industry-specific design
Disadvantages
- Less familiar to some employers
- Not a regulated insurance product
- Requires trust in the trustees' discretion
Cost, Coverage, Claims: A Comparison Table
Understanding the differences between group insurance and discretionary schemes becomes clearer when comparing their core elements:
| Factor | Group Insurance | Discretionary Scheme (e.g., Welplan) |
|---|---|---|
| Cost Structure | Premiums vary with risk, underwriting, and workforce size | Fixed, predictable contribution levels |
| Eligibility | May exclude older workers or pre-existing conditions | Covers all eligible employees automatically |
| Flexibility | Less suitable for rotating/project-based staff | Ideal for fluctuating or short-term teams |
| Claims Process | Strict policy wording, high decline risk | Trustees apply rules fairly; high payout rate |
| Setup Complexity | Medical disclosures, contracts, renewals | Simple enrolment, minimal admin |
This comparison illustrates why many construction firms are now leaning toward discretionary schemes. The ability to support staff with minimal red tape, flexible terms, and consistent payouts delivers better value and more trust.
Flexibility And Fairness In The Welplan Approach
Welplan designed its discretionary model specifically for the construction industry. It recognises that no two firms are the same and that benefit needs can vary widely depending on project size, workforce makeup, and contract length. That is why flexibility is central to the scheme's design.
Employers can select benefit levels that suit their business. Whether the goal is to match industry standards, enhance recruitment offers, or ensure peace of mind, Welplan makes it easy to tailor a package that suits your needs. Employers can apply cover to all grades of employees without dealing with health declarations or risk-based pricing.
Flexibility also extends to how benefits are delivered. Teams working on large infrastructure projects, short-term builds, or phased developments can all be covered efficiently. Unlike insurance policies that may not adapt well to workforce changes, Welplan enables employers to scale their contributions and coverage as teams shift.
Fairness is evident in the scheme's claims process, where trustees review each claim in accordance with the rules and assess the employee's circumstances. The high payout rate and fast claim resolution reflect that philosophy in action.
Employers gain more than just a benefits provider. They gain a trusted partner focused on construction and committed to supporting their workers.
Which Model Is Right For Your Company?
Choosing The Right Benefits Model
Every construction business has its own structure, budget, and workforce needs. Choosing the right employee benefits model means balancing cost, flexibility, and the level of support your employees expect.
Consider Group Insurance if:
- You have a stable, long-term workforce
- Your employees have minimal health risks
- You prefer a regulated insurance product
- Your team size meets the minimum requirements
Consider Discretionary Schemes if:
- Your workforce changes frequently
- You employ short-term or project-based staff
- You value simplicity and minimal admin
- You want coverage for all employees, regardless of health
- You operate in high-risk construction environments
Discretionary schemes, such as Welplan, offer a practical alternative. They provide consistent support across all types of construction roles, from site operatives to technicians, without the administrative burden of traditional insurance. There are no exclusions based on health or age, and claims are handled with care by a team that understands the industry's pressures.
If your workforce changes frequently, includes short-term hires, or if you value simplicity and high-impact support, a discretionary scheme is likely to meet your needs better. The flexibility to adjust benefits as your company grows or changes adds an extra layer of confidence for both you and your team.
Ultimately, the right choice is the one that supports your people without disrupting your business. Welplan's model provides construction firms with the tools to manage their workforce effectively, without compromising time or control.
Ready To Choose The Right Benefits Model?
Welplan has been supporting the UK construction industry for decades with flexible, reliable benefits tailored to site-based work.
Call: 0800 123 4567
Email: contact@welplan.co.uk
Speak to an expert advisor to determine the best benefits solution for your construction firm.
Frequently Asked Questions
Group insurance is a formal contract between an employer and an insurer, with fixed policy terms and strict conditions for claims. Discretionary benefits, on the other hand, are managed through a trust and reviewed on a case-by-case basis by trustees. They offer more flexibility, easier eligibility, and are often better suited to the variable nature of construction work.
Yes. Discretionary schemes, such as Welplan's, are specifically designed to support site-based employees. They don't require medical checks, and claim decisions are made quickly and fairly, based on scheme rules rather than rigid insurance contracts. Welplan, for example, approves over 99% of claims.
Discretionary schemes are generally more flexible for short-term or project-based construction teams. They enable quick onboarding, don't require long-term commitments, and provide meaningful financial support from the day of eligibility, ideal for the fast-paced, high-turnover nature of construction.