Yes. Group critical illness insurance can be offset against corporation tax, but the premiums paid are for the benefit of the employee and are therefore taxable against the employees income. The payout itself made to an employee is not taxable. However, premiums paid by the company on behalf of an employee are considered a benefit-in-kind and are taxable. Any claim made may have a financial impact on future premiums.
It is important to ensure your staff understand this before putting in place any policy that can impact their net income.