Health insurers face more consolidation

The CSS takeover should help nurse Intras back to full health Keystone

Swiss health insurance group CSS is set to swallow rival Intras, leading to the creation of the country's largest compulsory health insurer.

This content was published on November 16, 2007 - 12:31

The move, which should guarantee the smaller firm's future, comes amid ongoing consolidation in the health insurance market and gives its new owner a stronger presence nationwide.

Intras is the ninth-biggest health insurer in Switzerland with 400,000 customers. If the federal competition watchdog gives the go-ahead, the CSS group will have 1.6 million policyholders and yearly premiums worth SFr4.5 billion ($4 billion), making it the country's biggest insurer for compulsory health cover.

According to CSS, once its rival is integrated, its products, two brands, headquarters and agencies will continue to operate separately. Growth will come from a common strategy and no job losses are expected as a result of the takeover.

CSS made the takeover offer to Intras. The Geneva-based company accepted because it considered the proposal the best way of pursuing and developing its activities in an increasingly competitive market as well as of responding to its clients' demands.

The health insurer's association, santésuisse, said the takeover was not surprising. Spokesman Peter Marbet pointed out that Intras had been looking for a partner for some time.

He said that the company's reserves for its compulsory insurance division were low. Marbet added that the deal would give CSS a stronger presence in western Switzerland.

Policyholders are more concerned about the deal. Christian Canela, a legal specialist for the Assuas association, which defends customer interests against health insurers, said the takeover demonstrated a lack of real competition between insurance companies.


The health insurance sector has been undergoing consolidation for the past 15 years. According to santesuisse, the number of companies has shrunk from around 1,000 to just 87, much of it due to mergers or takeovers.

Many of the remaining companies are also part of groups, so that there are actually only around 30 firms providing compulsory health insurance.

"Health insurance costs have been rising rapidly and one way to control this is to enhance competition in the market," Xavier Comtesse of think tank Avenir Suisse told swissinfo. "Management costs often decrease when companies merge and that would be good for the consumer."

The six biggest insurers control up to 70 per cent of this market. Comtesse reckons more consolidation is possible, but the authorities need to keep a close eye on the situation.

"It is essential to have a balanced market with enough players to avoid monopolies being created," he explained. "It would be bad news for the consumer if the number of policies to choose from sinks below ten."

Comtesse says that consumers also have a role to play in controlling the market, and should exercise their legal right to change insurers once a year – something most don't bother to do.

"People are also part of the competitive process," he said. "Consumers should change their mentality and begin to pick and choose the policies that offer the best relationship between cost and services."

swissinfo with agencies

Key facts

Current compulsory health cover top ten:
1. Helsana
2. CSS
3. Groupe Mutuel
4. Sanitas/Wincare
5. Swica
6. Concordia
7. Visana
8. Assura
9. Intras
10. KPT

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Getting closer

CSS is Switzerland's second-biggest health insurer after Helsana.

It has 1.2 million policyholders, including one million in its compulsory health division.

It employs 2,000 people in 200 agencies across the country.

It recorded a profit of SFr67 million last year.

Intras was created in 1964 by the Genevoise, La Suisse and Vaudoise insurance companies.

It has approximately 350 employees and 14 agencies.

Annual turnover is more than SFr1.25 billion.

There are 400,000 policyholders, including 370,000 private clients.

The CSS group will control 18 per cent of the compulsory health insurance market once the takeover is complete next year. Helsana will remain the biggest insurer if private cover is taken into account.

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