Groupe Mutuel Holding

Activity Report 2021

Editorial

“There is nothing permanent except change.”
Heraclitus of Ephesus. Greek philosopher.

Nothing remains the same from one moment to the next: everything comes to pass, everything changes, everything dies all the time. This is what the Greek philosopher expressed in such famous quotes as: “Everything passes, nothing remains.” The two-year health crisis and the Russia-Ukraine war are cruel reminders of this.

In 2021, Groupe Mutuel underwent a number of changes as part of an in-depth transformation that began as early as seven years ago.

After a phase of consolidation, in particular in terms of legal and governance issues, including the creation of a holding company overseen by a non-profit foundation, Groupe Mutuel began a major transformation that was reflected in concrete actions. A new strategy based on health and pension provision. New values. Bringing the sales network in-house. A new brand identity. Innovations and partnerships with key players of the health system.

Our aim is to gradually move from being a spectator to becoming a committed player in the market. For us, 2021 will remain a year of change marked by the pandemic. However, after two years of an acute health crisis, we believe that the end of the tunnel is close. Yet, the current international tensions caused by the war in Ukraine are likely to have a major impact on our activities in the coming months.

We welcome the measured way in which the health crisis was handled by the Swiss authorities who showed pragmatism during a difficult period. Despite significant strains, the Swiss health system held up. Let us take this opportunity to praise the extraordinary work achieved by healthcare providers who did everything possible to support those affected by the devastating virus, without forgetting to care for other patients.

Strong and encouraging financial results

Against the backdrop of the global health crisis and significant international instability, the financial results of Groupe Mutuel are strong and encouraging. The Group ended 2021 with a loss of around CHF 78 million after we had reimbursed our reserves. Without this repayment of CHF 111 million to our insured persons, our accounts would have shown a positive result of CHF 33 million. Groupe Mutuel has kept its word, as this announced reimbursement benefits its policyholders every month.

Reserves are essential in the event of hard times, and we have seen that this can happen with the COVID-19 crisis, and now with the war in Ukraine which will inevitably have consequences. But we need to remain cautious because everything can change very quickly. In future, our reimbursement policy will depend on the trend in health costs and the situation on financial markets.

In 2021, financial investments enjoyed a successful year with the second best result in the history of Groupe Mutuel. This allowed us to strengthen the Group’s financial solidity, but also and above all to mitigate the increase in premiums since a significant portion of these gains was used to smooth out fluctuations.

However, this welcome respite is coming to an end. Health costs increased significantly in 2021, by around 7%. This is much higher than expected and shows that the cost-cutting measures taken by our political authorities are still not sufficient. In short, it is as if a two-year increase has been transferred to a single year. There has obviously been a very large catch-up effect, but this does not explain everything. We must continue to do everything we can to contain the rise in health care costs. Strong political will is needed in order to introduce effective measures, for example with regard to the price of medications or hospital planning. The financing of outpatient care, which has been discussed in the Federal Assembly for more than 10 years now, shows that politicians are still unable to reform the system. This pace is far too slow.

Stability in the health sector and growth in corporate and pension benefits’ insurance

For basic health insurance (AOS/OKP), 2021 ended with almost no change in the number of customers, which amounted to 946,500. The overall number of customers also remains stable at over 1.3 million. The Corporate sector continued to grow with over 27,000 insured companies, of which 1,500 new companies in 2021. For the first time, this sector of Groupe Mutuel has become the second largest in terms of income, ahead of supplemental insurance (LCA/VVG).

The number of persons insured under LCA/VVG remains stable. On the other hand, growth in turnover in private insurance is on the rise, which is satisfying.  Groupe Mutuel Prévoyance-GMP also experienced further growth. The range of pension solutions offered by Opsion, which was bought out in May 2021, further strengthens Groupe Mutuel's new strategy of positioning itself as the only insurer able to offer comprehensive health and pension benefits for private individuals and corporate clients.

To support this strategy, we have strengthened our internal sales network to be even closer to our customers and to provide them with customised advice. Every day, we are working to make our insured persons’ lives easier with, for example, the introduction of a new statement of benefits’ template, which is easier to understand.

Outlook for 2022

The outlook for 2022 is still unclear. However, one thing seems certain. Since health costs have risen very (and even too) sharply in 2021 and 2022, an increase in premiums, which are set to cover costs, seems unfortunately unavoidable.

For Groupe Mutuel, the challenges in 2022 will clearly be to further improve the quality of services and advice provided to our insured persons, to increase our presence in the German-speaking part of Switzerland and to launch new innovative insurance products by the end of the year.

As a health insurer, we have announced the creation of Compassana, together with two other health insurers (Helsana and Swica), Medbase (a major health provider belonging to the Migros Group) and the Hirslanden private clinics. This health ecosystem, which is based on a digital platform, will aim to improve the healthcare journey of our insured persons. We believe very strongly in this initiative and are looking forward to launching the first concrete applications this autumn.

Karin Perraudin
Presidente

Thomas Boyer
CEO

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Key figure

Groupe Mutuel Holding SA

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Amount repaid to insured persons in 2022

Health private customers

A stable financial year
The turnover in the Health sector amounted to CHF 5.31 billion (5.28 billion in 2020). This result contributed significantly to the balanced performance of Groupe Mutuel Holding SA.

Turnover under LAMal/KVG
The gross premium volume for compulsory health insurance (LAMal/KVG) levelled at CHF 4.116 billion. Furthermore, insurance benefits strongly increased to reach CHF 4.072 billion and the insurance underwriting result reached CHF -9.8 million. After various deductions, the LAMal/KVG insurance performance amounted to CHF -100 million (compared with CHF +6 million in 2020), which is mainly due to the release of our reserves for the benefit of our policyholders.

Private supplemental insurance (LCA/VVG & LAA/UVG)
Private supplemental insurance offered by Groupe Mutuel Assurances GMA SA ended 2021 with a positive result of CHF 19 million (compared with 14.6 million in 2020), which is largely due to good capital investment performance, but also to a significant drop in some types of claims during the two years of the pandemic.

Efficient cost-tracking measures
Invoice verification reduced costs by 9.6%, with savings of CHF 561 million.

7%: strong increase in health costs between 2020 and 2021
At 7%, the estimated rise in compulsory health insurance (AOS/OKP) costs between 2020 and 2021 has been much greater than in previous years. It is worth remembering that since 1996, when the LAMal/KVG (Federal Law on Health Insurance) was introduced, the average increase has been just 3%.

Number of persons insured with basic insurance (AOS/OKP)
The number of persons insured with basic insurance (AOS/OKP) was 946,500 as at 31 December 2021, compared to 950,000 in 2020, which represents a minimal loss of 3,500 (or -0.36%).

Individual pension provision

Individual pension provision remains a major concern
Compared to 2020, the economic situation in 2021 has improved, both in the equity markets and in the level of interest rates, and has favoured the life insurance sector, despite historically low interest rates. Pension provision remains a major concern for people, with major reforms planned for both the AVS/AHV first pillar and LPP/BVG second pillar schemes, which will make life insurance and third pillar solutions increasingly attractive.

Consolidation
Against this backdrop, Groupe Mutuel Vie GMV SA was able to close the 2021 financial year on a positive note, and the volume of premiums collected remained stable compared with 2020. In 2021, Groupe Mutuel Vie GMV SA registered 2,307 new clients (compared to 1,948 in 2020). The balance sheet total grew by 5.5%, or CHF 57 million, to reach CHF 1,032 billion (975 million in 2020). For the 2021 financial year, the gross premiums of Groupe Mutuel Vie GMV SA were stable at 83.07 million, compared with 83.87 million in 2020, and the number of policies in force as at 31 December 2021 was over 40,000.

A competitive position
In 2021, Groupe Mutuel Vie GMV SA introduced a new rate for earning incapacity and found itself in a very competitive position in this major life insurance market. Groupe Mutuel Vie GMV SA offers its insurance products through its own channels (Groupe Mutuel general agencies) and through a network of external agents.

Health insurance for companies and occupational pension benefits

Further significant progress
In 2021, insurance for companies continued to grow steadily, with the number of corporate clients increasing by 1,500 new customers to reach 27,000 companies insured by Groupe Mutuel. The overall turnover for the corporate sector rose sharply by CHF 60 million to 757 million. It is especially loss of earnings insurance in the event of illness that increased satisfactorily to reach a turnover of CHF 471 million. In five years, this figure has increased by more than CHF 210 million.

Success for Groupe Mutuel Prévoyance-GMP and further consolidation with Opsion
Groupe Mutuel Prévoyance-GMP also performed very well, with 2,735 affiliated companies and over 25,000 insured persons. The total LPP/BVG balance sheet is over CHF 2.6 billion, with an excellent coverage ratio of 117.4%. The remuneration of LPP/BVG assets is 4% in 2022, which is among the best in the market. Another advantage is that between 2015 and 2022, persons insured with Groupe Mutuel Prévoyance-GMP earned, on average, an extra 1.75% interest per year on their savings.

Opsion, which was acquired in 2021, also allows us to now offer a full range of pension products, thereby strengthening our presence in the market.

Close to our corporate clients
The human dimension and size of the “Health & Pension Provision - Corporate Customers” sector makes our services more accessible. Our dedicated managers pay close attention to companies’ needs. The strong growth in the number of corporate clients over the past years reflects the trust placed in the quality of our services, which remains one of our main objectives.

Prevention and health in the workplace
CorporateCare is considerable added value with more than 150 experts and specialists who are available to support companies in dealing with health matters in the workplace. Therefore, Groupe Mutuel provides the framework and toolbox to ensure that all corporate health matters are managed in the best possible way.

Patrimony

Strong growth in Patrimony insurance, particularly legal protection insurance
The Patrimony part of the business (legal protection, household contents, personal liability and CyberProtect insurance) had a positive 2021, with our Legis product enjoying particular success in the market with over 112,000 insured persons.

The full range of insurance products for private individuals
In addition to offering health insurance (AOS/OKP and supplemental insurance), Groupe Mutuel offers life insurance, corporate insurance and occupational pension plans. This range of products is completed by household contents’ and personal liability insurance, legal protection and insurance for risks and disputes on the Internet. Therefore, Groupe Mutuel is the only global personal insurer in Switzerland.

Governance

Groupe Mutuel is organised in the form of a holding company. The companies that make up the holding company are active in a number of insurance fields, such as health and pension provision, both for private individuals and companies. Groupe Mutuel Holding SA is wholly owned by Fondation Groupe Mutuel, a non-profit foundation. The Foundation supports the well-being of people in Switzerland, as well as health promotion and prevention measures, through a number of activities.

Structure of Groupe Mutuel

Structure of Groupe Mutuel

Organisational chart of Groupe Mutuel

Organisational chart of Groupe Mutuel
Groupe Mutuel Rapport 2020

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