Economic News Hebdo: First of all, how is the insurance intermediary sector developing in this chaotic macroeconomic context?
FNACAM: Hardly, firstly because the market is still primarily driven by car insurance and capitalization through bancassurance, which, as the name suggests, is practiced by banks. While the savings continue to increase and benefit insurance companies and banks, the auto branch generates more and more costs for agents and brokers while their income stagnates. For example, fuel price inflation is pushing many people to sell their vehicle, generating more uncompensated management tasks. “Price” remains a primary criterion at the expense of quality; and recovery, which was already not obvious, also becomes very problematic. All this weighs on the cash flow of agents and brokers who, in an inflationary context, see their margins eroded when they were already limited.
FNH: How do you approach the topic of digital distribution today?
FNACAM: Distribution through the digital channel is essential. Smartphones have flooded the market. Nothing is easier today than to question the search engines for information or an estimate. The practicality, simplicity and transparency that this channel offers is not lost on the increasingly digital-savvy people. But the benefits that customers get from it can only be fully beneficial if cominsurance companies involve insurance intermediaries in their digital strategy. The resources of the insurance companies are much greater than those of the intermediaries. Under these conditions, if they do not take the trouble to design, or rather co-design, digital solutions that integrate both the negotiation of services and remuneration, they are putting the future of the consultancy at risk. customer at all stages of the life of the contract. In fact, contrary to popular belief, digital generates more costs than it saves. In view of the low remuneration of intermediaries, few are able to open and finance operations related to a digital distribution channel (investment in tools and training, digital marketing, advertising costs, online payment costs, electronic signature costs, etc.) and physical.
Insurance is a worrisome topicthe gene, and for this reason the human being remains essential, whether at the time of the conclusion of the contract or at the time of the processing of the claim. Digital is also justified by the need for a diversified offer. However, customers do not care much about insurance, apart from motor vehicle liability, which is compulsory (and whose subscription can be easily checked by a police officer, which is not the case with other compulsory insurances). The market must be made aware of insurance and its applicability in all industries. This awareness requires funds that only insurance companies, or perhaps a group of intermediaries, can support. Digital distribution is therefore very practical for customers, but at the same time, for the implementation to be successful and for the quality of the service to always be there, it must necessarily integrate the middleman, who remains a significant actor.
FNH: On another note, the meeting places great emphasis on digital and disruptive technologies. Are insurance brokers well prepared for this new situation?
FNACAM: In addition to the elements indicated in the answer to your previous question, we believe that if there has been digital disruption so far, it is mainly at the level of the automation of management processes initiated by insurance companies, which took the opportunity to standardize their offer and delegate more management operations to intermediaries without compensation. It is also regrettable to see that currently the advantages of technology have not all been put to good use in favor of a win-win partnership for all parties and a clear improvement in the quality of customer service.
FNH: The issue of VAT is again at the center of the debate. What do you think is holding you back from solving this problem definitively?
FNACAM: To clarify ideas, this is our request that commissions paid to insurance intermediaries by insurance companies for presentation of insurance transactions should not be subject to VAT. Our profession continues to demand that this injustice be rectified: it must be remembered that we are the only country subject to 14% VAT on our remuneration paid by companies, while insurance premiums are already subject to “insurance tax”. This situation is completely unfounded. For several years defending this cause, we have convinced the DGI of the legitimacy of our position and largely rallied the Parliament and the Chamber of Councilors to our cause. Unfortunately, the finance laws of recent years were passed in difficult economic conditions, which did not speak in favor of our cause. We continue to fight and call for the introduction of VAT reform, which will put an end to this deviation once and for all.
FNH: What are your main expectations as a federation for the revision of Book IV of the Insurance Act?
FNACAM: One of the most important projects for which FNACAM has worked for many years is the amendment of Book IV of the Insurance Code regarding the presentation of insurance activities. It is of course eagerly awaited by the profession because it is part of a process of revising the current rules for the profession and correcting certain deficiencies in the current code; it takes into account the emergence of remote presentation of insurance operations. These main contributions to intermediaries would be the acceptance of a non-state license for people who want to take the exam to become an insurance agent or broker, a reformulation of the intervention area of the insurance bank and finally offer the possibility for brokers and agents (in agreement with their principals ) to have branches.