Mutual Benefit Insurance Companies: a partnership strategy

MCD has come a long way since its creation in St-Étienne in 1946 by prisoners of war and work camp internees returning from Germany. At the dawn of its 60th anniversary, it is now the second largest interprofessional mutual benefit insurance company and the seventh largest in France. It has a turnover of 250 million euros (2005), and protects 530,000 people. MCD extended its offer to include a corporate clientele in 1971. Since then, has regarded itself as a « creator of corporate life protection solutions » and creates tailor-made offers in the field of health, contingency funds, retirement, and savings.

Around 2,700 companies are now members. Present in 72 Departments, MCD offers individual and group contracts at national level. « A company with branches all over France benefits from the same guarantees in each of its locations. Brokers are very interested in our offer precisely because it offers this big advantage », explains Jean Chaize, MCD’s Chairman and Managing Director. This has led to the recent signing of a partnership agreement with Dexia Épargne Pension, a European banking group - world leader in the financing of local public institutions – and UNEP, the National Savings and Contingency Fund Union. The aim is to offer individuals and companies a solution for financing complementary health insurance contracts. « The target population for this contract will be the 50-55 year-olds. The process is based on taking out two contracts, simultaneous or otherwise - a life insurance contract and a group health contract », explains Chaize.

Adapting to changes in the law
Apart from the originality of this offer, unique in France, the operation is part of a partnership strategy MCD have been pursuing for many years now. For example, MCD is the traditional partner of CARAC and AGPM – the most important military insurance organisation in France. More recently it has joined forces with MGP (Mutuelle Générale de Paris) to create joint branches in the Île-de-France region, called « Les Mutuelles de Paris », financed 50-50 by the two partners. The first branch opened last month in the 9th arrondissement in Paris. This partnership strategy has been strengthened by the new Mutual Benefit Code, which came into force in 2003. The Code defines a system of rules that guarantee the particularity and values of mutual benefit companies whose sole mission is the insurance of persons.

« Since the new Code came into force, there have been many mergers amongst mutual benefit insurance companies in France. Because MCD hopes to be a major player in the field, we have established a policy of external growth, reflected above all, in our partnerships with other mutual benefit organisations insuring people », explains Patrice Pinel, Director General of MCD. Since the new measures, the mutual benefit companies are no longer allowed to manage health and social matters. MCD has therefore created ADRET to take over the management of its 100-bed old people’s nursing home, created in the 1970s and situated in the Loire. « In 2006, we plan to extend the home to include more places for residents with Alzheimer’s », says Jean Chaize.

Acting responsibly
The « sister company » also manages many preventive programs on the initiative of MCD. « It can work with companies in the fight against a number of illnesses and addictions, via partnerships with recognised organisations such as the League against Cancer, and the National Association for the Prevention of Alcoholism and Addictions », continues Chaize. Such action reflects MCD’s wish to be « a responsible player in the health system ». The idea of responsibility lies at the heart of recent reforms in this sector in France (see our article on the preceding pages). « Even though it may prove difficult to apply the Law of 13th August 2004 (on health insurance – ed), it has laid down important ground rules. I am convinced it will allow us to control excessive spending, on condition that each health player becomes or remains, a responsible player », says Patrice Pinel. Essentially, the aim of the Law is to place the accent on prevention. « Companies are the best messengers in this respect. They understand what is at stake in these measures », says Pinel.

« They have, moreover, a great deal of work to do to take the new regulations on board since the Fillon Act on the conditions of financing social insurance systems and “responsible contracts”, directly affects social security provisions within the company in terms of levels of cover and funding ». In the long-term, MCD would like to pursue its external development by continuing to follow its strategy of forming partnerships with other mutual benefit companies – unlike some of its fellow companies who plan on mergers - and by adapting. « The problem is dealing with changes in social security cover. Organisation, work, finances… the MCD mutual benefit insurance company is feeling the consequences of these developments ».