Insurers’ reserves under scrutiny
If there is one sensitive topic in the country’s political and social landscape, it is certainly this one.
Health insurance premiums account for a substantial share of household budgets. During the pandemic, however, many voices called for insurers to reduce the more-than-comfortable reserves they had accumulated over the years. Medical associations even suggested that premiums were being calculated slightly above the actual cost of healthcare, thereby generating significant capital surpluses. Under media and public pressure, politicians stepped in and tackled this delicate issue by revising the ordinance that sets the minimum threshold for these funds. Henceforth, an insurer only needs to hold 100% of reserves, compared to 150% previously. This decision led to a coordinated yet widespread reduction from all industry players.
Varying situations across cantons
While the savings made by policyholders are welcome everywhere, they will not be felt equally across the entire country. Thus, in Geneva and Valais, the decrease will be substantial, with -1.5% and -0.8% respectively. On the other side of the Röstigraben, where premiums are traditionally lower than in Romandy, a slight realignment will occur, with increases of around 1% in cantons such as Obwalden and Glarus.
Nevertheless, it is hoped that this trend will continue, as the government maintains that, with accumulated reserves of over 12.4 billion francs, insurers are still sitting on a far too comfortable cushion.
