‘En­vi­ron­men­tal sus­tain­abil­i­ty is im­pos­si­ble with­out fi­nan­cial sus­tain­abil­i­ty’

The private insurers’ industry association chose Lucerne as the venue for this year’s ‘Day of Insurers’. At the Culture and Congress Centre in Lucerne, Rolf Dörig, chairman of the Swiss Insurance Association SIA, reminded the audience that since the COVID-19 pandemic and the war in Ukraine, security has taken on a different status in politics, business and society. ‘Without security there is no stability, no prosperity, no freedom’, he stressed, going on to say that security was not only part of the government’s core remit but also the core competence of the insurance industry. ‘In our case, the top priority is financial security. We take the pressure off companies and private individuals alike by assuming their risks and giving them the security they need to plan and the freedom to decide how they want to live,’ Dörig told 220 guests from the fields of academia, politics, business and public administration. He referenced a new study of specialist literature conducted by the University of Lucerne. According to the study, an event such as a natural catastrophe shaves 0.6 to 1 per cent off gross domestic product in the short term and double to triple that in the long term. In cases involving insured losses, however, the study did not identify any measurable negative effects on gross domestic product.

Mastering top risks together

In Lucerne, Rolf Dörig explained that the financial sector accounts for a total of 10 per cent of domestic economic output. ‘Insurers, with their above-average productivity, account for about half of this’. The importance of the financial sector is also reflected in the labour market. Including all companies that are indirectly involved in the sector, the financial centre provides 430,000 full-time jobs. One in ten jobs in Switzerland is linked to the business activities of the financial sector. ‘These figures reflect our success, but they also create obligations for us. The insurance industry wants to be more than just economically successful. It also wants to live up to the level of responsibility that is commensurate with its importance and help solve social issues,’ said the chairman of the SIA. Dörig cited the insurance of major risks such as cyberattacks or power outages as an example. The private sector cannot insure these risks single-handed, however. ‘But if the federal government and the insurance industry join forces, the limits of insurability can be extended. This could, for example, take the form of partnerships in which the federal government assumes the role of reinsurer and the insurance industry contributes its expertise, infrastructure and customer relationships.’ The Natural Perils Pool shows that this model works in practice and has been providing relief for the public sector for several decades. ‘The state cannot do everything alone. Nor is it the better insurer just because it appears to have unlimited funds at its disposal,’ Dörig warned.

Reforms needed in retirement provision

Retirement provision is also about security and sustainability. ‘Private insurers are directly involved in that re-sponsibility through the second pillar. Our three-pillar system strikes a conceptual balance in retirement provision. This is a characteristic of sustainability and a sign of strength,’ Dörig explained. The interaction between the three independent pillars is a real success story. ‘However, the key aspects of the individual pillars need to be adapted to reflect the current overall conditions. Increased life expectancy and the shift in the ratio of working people to pensioners have to be taken into account.’ Dörig expressed regret that the parliamentary process regarding the reform of occupational pensions (OPA reform) is being prolonged with the referral back to the Council of States’ committee, but was confident that the second pillar would not end up being combined with elements of the first pillar. Dörig also spoke about the referendum aimed at stabilising the OPA: ‘The two bills seek to harmonise the retirement age, promote flexibility in retirement and limit the VAT increase to 0.4 per cent.’ He expressed his confidence that voters would see the full picture. ‘We have to offer future generations the same opportunities that we enjoy today – this is the only way to make the system sustainable.’

Three aspects of sustainability

Rolf Dörig emphasised in Lucerne that all three aspects of sustainability – society, the economy and the environment – are important for the insurance industry. While there is much talk about environmental sustainability, financial sustainability deserves more attention. To prevent and insure natural hazards and assume environmental risks, environmental sustainability concerns have to be taken into account. In addition to improving its own ecological balance sheet, as an employer the industry also shares responsibility for social sustainability throughout the entire business process. Private insurers are helping to shape the working world of tomorrow, for example by offering flexible working models, promoting young talent and increasing the proportion of women. The latter currently stands at around 45 per cent in the insurance sector, while the proportion of apprentices is 4 per cent and a quarter of employees working part-time.

Finally, financial sustainability is very important for the insurance industry, Dörig explained. ‘Environmental sustainability is impossible without financial sustainability,’ he stressed. He referenced the Sustainability Report for the 2021 financial year, which the SIA published for the third time a few days ago. As a key institutional investor, the insurance industry can also influence financial sustainability in the economic cycle through its investments. And that is exactly what it is doing: According to the report, 80 per cent of the investments made by Swiss insurers last year were linked to sustainability criteria.

Regulation with a sense of proportion

Dörig made it clear that sustainability, security and freedom go hand in hand by highlighting just how important these values are in society: ‘Freedom is part of Switzerland’s purpose as a state. It is at the root of the country’s successful history, which continues into the present.’ Business also needs a liberal framework and regulation with a sense of proportion. ‘As much regulation as necessary and as little as possible. This principle has made a key contribution to the prosperity and attractiveness of our country as a business location. We want it to remain our guiding principle in the future,’ said Dörig.

Professor Christoph Schaltegger and Finance Minister Ueli Maurer spoke about the professional classification of financial sustainability at the ‘Day of Insurers’. Schaltegger used the industry event to talk about the prerequisites for, and importance of, sustainable financial policy. He said that spending cuts were not something to be afraid of. The economist, who lectures at the University of Lucerne, also emphasised that clear debt stabilisation and transparency rules for all financial obligations are the prerequisites for modern and sustainable government financing.

Ruedi Kubat and Christoph Schmallenbach appointed as new members of the Managing Board

The general meeting of the SIA also takes place during the ‘Day of Insurers’. At the 92nd meeting, the delegates elected two new members of the Managing Board: Ruedi Kubat, CEO of Allianz Suisse since 1 January 2022, replaces Severin Moser. Christoph Schmallenbach, CEO of Generali Switzerland since 24 February 2022, succeeds Andreas Krümmel. Philomena Colatrella (CEO of CSS Insurance) and Professor Thomas Szucs (Chairman of the Helsana Group) were confirmed for a further term of office.

Note to editors

The Swiss Insurance Association (SIA) represents the interests of the private insurance industry at the national and international level. The association comprises about 70 primary insurers and reinsurers employing a workforce of 49,902 people in Switzerland. Overall, the member companies of the SIA account for about 85 per cent of insurance premiums generated in the Swiss market. This makes the insurance industry and, as a result, the SIA a major force in the Swiss economy. Private insurers are therefore committed to the successful and sustainable development of the areas in which they operate, in business, social and political terms, and thus assume economic responsibility.

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