The ABI has reiterated its call for tax incentives to improve the UK's poor record on rehabilitating employees who are injured or fall ill in the workplace.

The trade body is calling for a new tax credit to reward employers who provide rehabilitation programmes.

It says employers who provide rehabilitation benefits should not have it deemed a tax benefit for employees and should qualify for tax relief for employers.

Speaking at an insurance conference, Justin Jacobs, the ABI's head of liability and motor insurance said: “Britain has one of the worst records on treating workplace ill health of all industrialised nations. The ill, injured, their families, and businesses all pay the price through financial strain and lost productivity. Insurers are doing much to develop rehabilitation products, but we need to encourage greater employer take up, and get the government to lead in promoting greater rehabilitation.”

Last year 28 million working days were lost to work–related illness costing businesses up to £13 billion a year.

In addition, 2.7 million people claim incapacity benefit, costing the taxpayer £7 billion a year. Only 12% of UK employers provide any form of rehabilitation programmes for their employees.

Lord Hunt, chairman of the financial services division at law firm Beachcroft, said: “As everyone is promoting rehabilitation there is a huge opportunity for the insurance industry to come forward with coherent plans. This is a significant opportunity which mustn't be missed.”