Navigating Change in the Irish Group Risk Market into 2026 

This update outlines the current market environment, recent insurer changes and practical steps employers can take to protect their workforce while managing costs effectively. It also highlights how a structured employee benefit design review can help control premiums in a constrained market. 

Key Insurers and Market Share
The Irish group risk market is served by five major insurers. Aviva, Irish Life, New Ireland and Zurich have been operating in Ireland for an extended period. Utmost is exiting the market, having closed to new business from the end of 2025, while MetLife is entering the market as a new competitor. Each insurer brings unique strengths, with Irish Life holding the largest market share. However, the market remains fluid, and insurer competitiveness varies year to year.

Significant case-by-case variations reflect a different claims experience from employer to employer. There has been a very marked rise in income protection claims post-pandemic, particularly among higher-paid employees. This is a notable shift: pre-pandemic, higher-paid employees had lower levels of claims than the general working population, once adjusted for age.

The number of insurers competing in the group risk market in Ireland is not high. In addition, some insurers are selective about which industry sectors they will quote for. Employers in certain industries have sometimes, in recent years, been left with little choice but to accept rates that they may feel are higher than warranted. 

Service Levels and Operational Capacity
Service quality has appeared in some cases to be under pressure since the pandemic: for example, claims processing and renewal handling have often become very slow, while some insurers are investing in operational improvements, capacity constraints remain a concern. These service pressures add to the challenge for employers already dealing with rising group risk premiums.

Utmost’s Market Withdrawal
Utmost ceased writing new business in the Irish domestic market from 31 December 2025. Existing policies will run off according to their rate guarantee periods, but employers will need to plan for alternative arrangements at renewal. This withdrawal shrinks market capacity and may increase pressure on remaining providers. It also reduces competition, which can make it harder to secure lower group risk premiums.

MetLife’s Market Entry
MetLife entered the Irish group risk market in early 2026, initially offering death-in-service cover and perhaps in the future - income protection benefits. This should enhance competition, capacity and service innovation over time, potentially supporting more competitive death in service and income protection premiums.

Small Number of Group Income Protection Providers
New Ireland has suspended quotations for new income protection business, further tightening market capacity. This leaves Aviva, Irish Life and Zurich as the primary providers for income protection, reducing competition and potentially increasing pressures on service.

Impact on Quoting and Claims Management
The combination of Utmost’s exit and service issues at some other providers has led to increased demand for market reviews and early rate quotes, straining insurer capacity. 

The withdrawal of an insurer (or, in the case of income protection, two insurers) from the market is problematic. While it usually remains possible to obtain competitive bidding for group risk benefits, cases may arise in the short term where it is impossible to get more than one quote. In a worst-case scenario, a situation could arise where no insurer has an appetite to cover a scheme – though, to date, we have not seen this occur.

Managing Pricing and Benefit Design
Employers concerned about rising premiums can consider benefit design adjustments. The following measures, alone or in combination, could help mitigate rising costs while maintaining valuable cover:

Larger employers and multinationals could also consider alternative funding methods for death and income protection benefits as part of a strategy to manage premiums.

These include:

• Self-insurance by using their defined benefit pension plan for death benefits (if available).
• Captive insurance vehicles, potentially with a domestic group risk insurance provider acting as the fronting insurer for the captive.

If assessing self-insuring benefits such as income protection and not using an insurance provider, employers will also need to consider transitioning the claims management in a self-insurance environment. The employer must decide who is eligible for benefits or engage a third party to assist. It is often helpful to separate the claims determination to a third party to ensure consistency and impartiality.

A balance clearly needs to be struck between maintaining the employee value proposition on one hand and controlling costs on the other. Any changes will need to take account of contractual benefit entitlements and the potential for damage to employee relations. 

Mercer can support employers by carrying out an employee benefit design review, helping to identify changes to benefit structure, funding and governance that can control future group risk premiums while preserving a competitive employee offering.

Early Intervention and Absence Management
Engagement with insurers’ Early Intervention Services (EIS) is critical to managing the claims experience, particularly for mental health and musculoskeletal conditions. Proactive absence management and timely referrals to EIS can prevent short-term absences from becoming long-term claims. 

There is, accordingly, a direct connection between successful use of early insurer intervention and absence management facilities, on the one hand, and employee wellbeing and future premium levels, on the other. Effective absence management is therefore a key lever for employers seeking to stabilise income protection claims and reduce pressure on income protection and death in service premiums over time.

Timing and Approach to Market Reviews
Given current market constraints, Mercer recommends initiating market reviews eight to nine months before rate expiry to accommodate potential delays in obtaining competitive quotes. In some cases, negotiating rate extensions with incumbents may provide additional time for market conditions to stabilise.

The Irish group risk market is facing a period of upheaval marked by insurer exits, new entrants, pricing pressures, lack of competition and service challenges.

Employers who wish to control costs while looking after their people must react. There can be a case for reviewing benefit arrangements and comparing them with those of industry peers. A case exists for engaging proactively with the market, particularly (but not exclusively) in the year leading up to rate expiry.

Mercer’s group risk and benefits advisory teams stand ready to assist organisations that wish to get ahead of the issues changing the group risk market. For tailored advice and support through this evolving landscape, please contact your Mercer consultant.

Footnotes
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