Insurers and their reserves

If there is a sensitive topic in this country’s political and social life, it is most certainly this one!

It goes without saying that health insurance premiums represent a significant part of household budgets. However, during the pandemic, many voices spoke up, asking insurers to reduce the more than well-padded reserves they have built up year after year. Groups of doctors even considered that the premiums were calculated slightly above the real cost of health, thus generating significant capital surpluses. Under media and public pressure, the government in turn seized this thorny subject by revising the ordinance setting the minimum threshold of these funds. From now on, insurers must only have 100% in reserves, rather than the previous 150%. This decision resulted in a concerted but widespread reduction by all players in the sector.

Unequal situation between cantons

While the savings to policyholders are welcome, they will not be equally advantageous throughout the country. In Geneva and the Valais, the reduction will be substantial, at -1.5% and -0. 8% respectively. On the other side of the Röstigraben (the cultural boundary between German-speaking and French-speaking Switzerland) – where premiums are traditionally already cheaper than in French-speaking Switzerland – there will be a small adjustment in Obwalden and Glarus, with a 1% increase.

One can however still hope that this trend will continue, since the government still estimates that with a cumulated 12.4 billion-plus francs, insurers are still sitting on a mattress that is far too cushy.