Group buys: ways to reduce home and health insurance bills in France

Group buy schemes have begun to gain popularity in the world of French insurance, as consumer organisations and local authorities negotiate money-saving deals for residents.

The practice, which first emerged with regards to energy contracts, involves gathering together as large a group of customers as possible so that they can benefit from a special rate while still receiving a quality service.

In the energy sector the offers are open to all but for home insurance (assurance habitation) and health insurance (assurance santé), they are often limited to specific groups, such as low-income families or the elderly.

“The idea is to negotiate unique offers, both in terms of price and in terms of a quality service,” Luka Payras from the insurance branch of Selectra told Le Monde.

“Thanks to strength in numbers, we can obtain effective contracts at competitive prices, in comparison to basic contracts taken out at an individual level.”

Group buy schemes can be found by typing in ‘achat groupé’ and the type of insurance into a search engine, where you will find details of the cover offered by different companies. You can also add the name of your local authority to see if it is involved in any initiatives.

When there is a scheme available, customers will likely be asked to sign up and then wait to see if there are enough people for the offer to be carried through. If there are, they will normally be sent an email with the terms of the policy and be free to choose whether or not to continue.

The advantages and disadvantages

Group buying schemes enable consumers to avoid insurance policies with too many exclusions, such as the invalidation of cover for factors such as large gaps between window security bars.

They also stop the price of cover from “varying depending on age or location,” said Arnaud Delpierre of Dékuple Assurance.

“We have pooled [offers] and created just three different tariffs for workers, retirees and students, no matter their age and address.”

The Mairie de Paris is currently seeking home insurance offers for Parisian residents on low incomes and is calling for a good price for superior cover.

One of the insurers to propose an offer – including provision for cockroaches and bedbugs – is called Luko. The company’s director of partnerships, Jordan Simon, said: “Our selections are carried out based on a good quality/price balance, but also on ethical criteria.

“In our company, our operational costs are independent to what we pay to our customers in the case of a claim. If there remains a surplus after we have reimbursed everyone, we pay it back into partner associations chosen by our customers.

“This avoids a conflict of interest, as we do not make more profit if we pay out less.”

At the moment, more than 2,800 French communes are offering group insurance schemes to their residents, covering 25,000 people.

The city of Toulouse has since January been offering people aged over 60 with an income of less than €1,800 net per month to sign up to a health insurance contract costing €43.76 per month until the age of 70, when it goes up to €49.77.

One thing that people interested in becoming part of a group buy initiative should note is that the insurance policy will not be personnalisable. So, with regards to health insurance it will not be possible to choose a contract which is particularly focused on dental care, for example.

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