“Rip-off”: Health insurers collect half a billion francs in commission

Benjamin Giezendanner uses the fictional example of his family to show how the broker principle works in healthcare. “Let’s assume that we are convinced by an intermediary to change health insurer,” says the SVP National Council. “Then he will receive a bonus of 6,210 francs.”

He and his wife each receive 3,000 francs for change because they have additional insurance, says Giezendanner. There would be an extra 210 francs for his three children, who have basic insurance: 70 francs per child.

If Giezendanner has his way, such transactions will soon be a thing of the past. “Stop this rip-off,” he demands. This week he will submit a motion that will prohibit placement with health insurers in basic and supplementary insurance. To this end, he will collect signatures in the council from Monday.

“It should not be the case that thousands of families can no longer pay their health insurance premiums,” says Giezendanner, “while a few dubious intermediaries enrich themselves enormously.” The Federal Council must act immediately and amend the Federal Law on Health Insurance KVG (Basic Insurance) and the Federal Law on Insurance Contracts VVG (Supplementary Insurance).

Giezendanner rejected in parliament the general regulation of insurance intermediaries. However, in healthcare it is about public money, he emphasizes. His father Ulrich Giezendanner, who was vice-chairman of the KPT board of directors until the end of the year, had also previously publicly criticized the brokers – and was thus criticized himself.

It’s a lot of money. Today, a total of 12,000 independent insurance intermediaries are registered with the financial markets regulator Finma. It is unclear how many of them work for the supplementary insurance policies of health insurers, for which Finma is responsible. But there must be thousands.

According to estimates, health insurers collect a total of approximately 480 million francs in commissions. According to the Federal Office for Public Health, they receive 48 million euros for basic insurance. There the commission for a change is limited to 70 francs.

Comparison expert Felix Schneuwly estimates that intermediaries even skim 430 million francs from supplementary insurance. According to insiders, they collect between 1,000 and 3,000 francs per change.

According to Schneuwly, there has been significant advertising and acquisition spending since the industry agreement banned telephone marketing. Addresses of insured persons are now obtained via Google, comparison services, sponsorship and competitions. It is not clear whether and, if so, to what extent health insurers will reimburse this.

The intermediaries sometimes have a shady reputation. In a press release, Comparis describes how certain intermediaries work. They contact insured persons in Switzerland via call centers from abroad, as cold calling by telephone is prohibited in Switzerland. They pretended to be conducting an investigation. Anyone who agrees to this must then make an appointment with an insurance broker during the same conversation or later.

How lucrative the business is is evident from one point: in recent years, “with the exception of CSS and Helsana, most major insurance companies have bought up intermediary companies for a lot of money – reportedly up to 10 million,” says expert Schneuwly. He sees the reason for this in the industry agreement: it did not provide for a maximum commission for agents who worked for the health insurers themselves.

The big question is: where did the funds get the money to buy these intermediary companies? “They are not allowed to come out of the basic insurance business,” says Schneuwly. It would be interesting to know whether Finma has conducted audits of such acquisitions to find out the actual costs.

Finma confirms that it is “of course aware of such cases,” says spokesperson Tobias Lux. However, so far it has not carried out any audits because that was not possible. “Since investments in sales organizations are typically made by parent companies that are not supervised,” says Lux, “Finma has no information about the origin of the funds and the size of the shareholding.”

On September 5, the industry associations Curafutura and Santésuisse published a new industry agreement. It wants to put internal and external intermediaries on an equal footing. That is why it no longer limits the commissions in supplementary insurance to twelve monthly premiums, but redefines the term economic efficiency. SVP Councilor Giezendanner criticizes this: “That means that the provision for additional insurance should even be open to the top.”

The trade associations see this differently. The reward must be “in reasonable proportion to the products sold,” said Matthias Müller, head of politics and communications at Santésuisse. He also takes a position on behalf of Curafutura.

“Serious advice is important in the insurance world and especially in health insurance and is highly appreciated by many customers,” Müller emphasizes. “With the industry agreement, we want serious, sensible advice to be strengthened and dubious intermediaries to be reduced. These have been significantly reduced in recent times.” (aargauerzeitung.ch)