Threatening the sector with a tax, the Minister of the Economy, Bruno Le Maire, calls for “at least” a freeze on insurance premiums for cafes, hotels and restaurants. Insurers are open to the idea of a freeze even if the players in the sector feel they are unfairly criticized.
New pressure on insurers. Tuesday evening, the Minister of the Economy, Bruno Le Maire, asked insurers to commit ” at least “ on a premium freeze for cafes, hotels and restaurants. Otherwise, the executive could allow parliamentarians to adopt a tax costing the sector 1.2 billion euros.
“It is the minimum gesture that I ask them, that they freeze the insurance premiums and I think that they can do even a little better, declared Tuesday evening the Minister Bruno Le Maire, interviewed on the LCI television channel, after a meeting with representatives of the sector. They have until next Monday to do so. “
A “very brutal” levy for insurers
The sector has already announced measures to support businesses, in particular by endowing the solidarity fund with 400 million euros for businesses and the self-employed, but ” it’s not sufficient “, according to the minister.
These statements come after the Senate adopted an amendment during debates on the 2021 budget establishing an “exceptional solidarity tax” of 2% based on premiums for non-life insurance contracts.
This levy estimated at 1.2 billion euros is “Very brutal for insurers”, recognized Bruno Le Maire while the executive also decided to tax health insurers to the tune of 1.5 billion. This observation did not prevent the Minister from warning that “If next Monday, nothing is done (….) We will adopt this amendment”.
Public opinion pressure
“There are marchers who could be in favor of this tax. There is a feeling in all political groups that insurers are not doing the job. There is pressure from public opinion ”, explains Valéria Faure-Muntian, Member of Parliament (LREM). The government has said it is unfavorable to the tax in debates in the Senate, but it may be all the more sensitive to the signals sent by parliamentarians on its side as discussions around the comprehensive security law have turned to confrontation with the majority.
« We can see that we are in a political problem ”, notes Thierry Martel, the boss of Groupama and also representative of mutual insurers within the French Federation of Insurance (FFA).
“It is not complicated for the mutual sector to engage in premium freezes, we think so much that it is legitimate that we have already done it”, he says, ensuring that insurers will work on other proposals.
A “completely conceivable” gesture for AXA
The story is the same on AXA’s side. “If it is a question of freezing the tariffs next year, it is something quite conceivable”, declared for his part the boss of the insurer in France, Jacques de Peretti, on RTL Wednesday, saying he wanted to reserve the decision to the minister.
In the majority, Valéria Faure-Muntian, for her part, evokes the idea of extending the freeze to health and welfare contracts of companies and to other actors than hoteliers and restaurateurs to also benefit tourism, recreation, discos, sports activities, etc.
According to our information, the track of a gesture in favor of automobile policyholders has also been mentioned. This would be appreciated by consumer associations, who have called for rebates. However, this solution would have met a lot of opposition.
2 billion euros in more claims
Since the start of the crisis, insurers have been in the sights of customers and politicians. They have been accused of discarding their obligations to cover business losses. They have also been criticized for taking advantage of the drop in health spending and those in car accidents during confinement. The fate of hoteliers and restaurateurs, hit hard by the confinements, crystallizes all the tensions.
These have gone up a notch since insurers asked some customers to accept endorsements specifying that they will not be covered in the future against the consequences of a pandemic.
For their part, insurers consider that the criticisms addressed to them are often “unfair”. They say they have put 2.1 billion euros on the table to help companies in the form of financial aid, rent cancellations or even premium discounts. They admit having made “savings” on the automobile but nevertheless assess the increase in the burden of claims linked to the crisis at 2 billion.