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Insurance: against very strong interest rate increases from 2024

Published 22 Dec 2022 at 18:07

After the announced rate hold for next year, insurers are likely to return to sharp increases in 2024. “Our hypothesis is that we will be on increases that will inevitably be violent,” declares Cyrille Chartier-Kastler, founder of Facts & Figures, a specialist research firm. We don’t see how we can be outside of increases of 6% to 8% in 2024.”

In recent years, auto and home insurance contracts have seen relatively small increases – between 1% and 2% – but the price increase will affect the industry. For 2023, under pressure from Bercy, insurers have committed to limiting the increase in personal insurance premiums to a rate below inflation. It currently stands at 6.2% in France.

In January, Cyrille Chartier-Kastler therefore expects increases of 3% to 5% in car insurance and home insurance. A significant change in prices, but which could have been worse for consumers.

The expert believes that insurance companies have the means to absorb inflation in the short term. In particular, they provided margins under the inclusions (the policyholders had driven little and therefore had few claims), although the climatic events of 2022 weighed inversely on their results.

Wage pressure

But in addition, companies will face three major types of pressure. First, wages. As can be seen from the agreements used at AXA or Groupama, revaluations may average around 4% to 5% in the profession from next year. A pause after years of wage restraint in a context of low inflation.

Second, overhead. In addition to wages, insurance companies also have to pay an electricity bill. “Thirdly, there is all the inflation that comes from the repair chain, insists the expert. The price of spare parts is exploding”. According to its estimates, the average price of a rear-view mirror, for example, has increased by 6% between 2021 and 2022, or even by 11% for SUV – models.

As part of its commitments in favor of purchasing power, at the end of September the professional association France Assureurs had also obtained from the Minister of Economy Bruno Le Maire the creation of a working group on spare parts with all stakeholders. , including vehicle manufacturers and their suppliers. Since then, this work has not been the subject of any particular progress.

More aggressive agent companies

However, the final extent of the price increase will depend on the competition. After ceding market share, especially in favor of bancassurance companies such as Crédit Agricole or Crédit Mutuel, companies that distribute through general agents (AXA, Allianz, Generali) are implementing aggressive pricing policies in new business in the automotive sector, according to the facts. & Figures.

In home insurance, on the other hand, they do not hesitate to let part of their portfolio slip away, while mutuals without intermediaries (Covéa, Aéma etc.), bancassurance companies and insurance companies (Leocare, Lovys etc.) are the most aggressive customs issues. “The networks of general agents are on average 10% more expensive than the market”, estimates Facts & Figures, which compiles its annual barometer on the basis of anonymous surveys.

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