Aviva has launched new bespoke insurance policy for businesses which operate an employee salary sacrifice car scheme.
The new policy was developed and modeled on its Fleetwise commercial insurance product for corporate fleets, in response to the growing popularity of companies rewarding staff with tax efficient employee benefits, Aviva said.
Through this policy, Aviva can provide a block insurance package to companies operating the scheme, with no limit on the number of vehicles covered by the policy.
According to the Aviva, in a salary sacrifice car scheme, the employer will receive the vehicle from the leasing company, but only pays net of tax rather than full price. This saving will be passed on to the employee, who receives a brand new car at a better price than if they went independently to the leasing company.
Aviva development manager of commercial product development Mark Keavney said that the salary sacrifice scheme allows employers to offer tax benefits to staff when the employee leases a new vehicle over a number of years.
"The scheme is likely to be most attractive for companies with large fleets, whether FTSE-listed, privately-owned or local authorities, Keavney said.
"Payment is taken directly from the employee’s salary, and is usually contracted over two or three years. The employee saves on national insurance and income tax up to the value of the scheme."