Industry positions

Insurance is committed to sustainability in all its scopes: environmental, social and governance (ESG).

The insurance industry contributes to creating a society that is more resilient to the harmful effects of climate change. Insurance promotes prevention, compensates damages and drives reconstruction after natural phenomena. It is also a first-rate institutional investor and, for this reason, can be a significant player in the challenge of financing ecological transition and construction of a decarbonised and more fair economy investing in “green” assets.

In the social sphere, insurance accompanies people throughout the different stages of life, covering such varied situations as healthcare or managing the consequences of a road accident. It also protects people’s assets, whether managing long-term savings or covering properties and businesses. Insurance helps reduce inequalities and generate a more united society. It is also an employment sector of reference, a provider of stable, equal employment of the highest quality. A sector open to talent.

Regarding governance, insurance companies are subject to one of the most demanding legislative frameworks when reporting to the public. The industry is particularly active with the promotion of financial education through initiatives such as Estamos Seguros, a project aimed at bringing the world of insurance closer to the public;El Riesgo y yo, a financial education programme for teenagers  and  is also deeply involved with client protection. It also takes part in alliances such as FINRESP, the Spanish Centre for Sustainable and Responsible Finance. This is a joint initiative launched by UNESPA together with other associations representing collective investment and credit institutions.

The insurance industry also implements sectorial initiatives, such as the insurance solidarity fund. Through a series of pooled donations under the motto #EstarPreparados, the sector channelled aid to overcome the consequences of COVID-19 through support programmes for vulnerable collectives and the promotion of scientific research.

Insurance is a very competitive sector that needs to constantly adapt to its clients’ needs. To do this, it makes a decisive commitment to digitalisation.

The key to the insurance activity lies in data management. From the beginning, insurance has based its activity on the laws of large numbers. Probability and statistics have made it possible to pool risk and guarantee protection against any eventuality.

In the digital age, it is necessary for legislation to take this reality into account and enable the evolution of digitalisation and innovation in the insurance sector, all within a framework of respect for competition and equality among all operators.

This exercise must also be completed with an in-depth review of current legislation to free it from unnecessary formalities and obsolescence, as well as obstacles that prevent integration of the insurance sector into the digital era.

Only through adapted and technologically neutral legislation will entities be permitted to put the technological advances at the service of their clients and provide products and services that adapt to their present and future demands and needs.

The laws of the insurance sector have been traditionally created through dialogue between the regulator, the legislators and industry representatives. At a time like the present, full of new challenges and social changes, this exchange of opinions is, if possible, more important to make new methods of contracting possible and to adapt to new consumer habits.

Finally, UNESPA also considers it necessary to raise awareness in society about cyber risks and promote cybersecurity, particularly among SMEs.

Spanish society is ageing. As it occurs in many other developed countries. This process, which is big news for social progress, is a challenge for those same societies when providing the elderly with the standard of living and service to which they are entitled. However, the problems caused by the increasing weight of elderly people in the population as a whole can be solved if saving for retirement is promoted among those who are currently active. In short, the challenge of ageing can be solved if action is taken early enough.

Spain must guarantee that its future pensioners live with sufficient economic means. Only this way will the country be able to grow economically and generate prosperity for its citizens. To guarantee the wellbeing of the elderly, it is necessary for retired people to have several sources of income. The public pension (first pillar) must continue to be the main income source for retirees but, so as not to lose economic capacity in this stage of life, it is advisable for that pension to be complemented with corporate pension plans (second pillar) and with individual savings and pension instruments (third pillar).

Support of the complementary social welfare must take into consideration both collective savings and those done by citizens individually, as these mechanisms allow all kinds of employment situations to be dealt with (employees, freelancers, etc.) and offer citizens more alternatives. In short, they are methods of saving for retirement that reinforce each other. In this line, increasing the reduced limit that currently exists in Spain for contributions to pension plans and insured pension plans (PPAs) is proposed.

As well as promoting savings for retirement, receiving these savings later on as a life annuity should also be encouraged, thus guaranteeing that retirees can enjoy their complementary pensions without being exposed to the volatility of the financial markets or the risk of their own longevity.

The insurance industry offers all kinds of solutions to cover retirement. Insurance, pension funds, life annuities, etc. All these products offer ways to generate a complementary pension to Social Security benefits.

The social welfare model based on three pillars (public pension, collective saving and individual saving) is that set out in the Spanish Constitution and is also what appears in the recommendations of the main European institutions (European Parliament and European Commission). It is also important to remember that the public pension and private savings for retirement, whether collective or individual, complement each other. The combination of these three elements is key to a modern welfare system.

Access to healthcare is one of the welfare pillars for Spanish citizens. Access to public healthcare is guaranteed, but the ageing of the population causes pressure on State budgets. To guarantee the best service possible with the available resources, insurance suggests several proposals to public authorities. On one hand, insurance advocates for establishing public-private collaboration frameworks where healthcare is provided by the most efficient stakeholder, while maintaining the universal nature of access to the service. The creation of these agreements will enable:

• The healthcare bill to be reduced or, similarly, to care for more people and better with the same amount of money.
• Waiting lists to be reduced and the quality of care to patients to be improved.
• Better infrastructure for healthcare to be available.

On the other hand, various tax incentives can be set in favour of private health insurance to reduce the number of people turning to public health. After all, each patient treated through this channel does not generate costs for the State healthcare network. Improving the financing system for civil servant mutual societies is also proposed (MUFACE, MUGEJU and ISFAS) due to their positive experience and that 80% of their members choose private insurance. In short, insurance advocates for optimising the available healthcare resources, whether public or private. Only this way can a greater number of people be cared for in the best way possible.

When it comes to road accidents, the insurance sector has agreements to provide healthcare to affected people. It collaborates with healthcare services of the different autonomous communities as well as with the different stakeholders from private healthcare.

Insurance is the safety net that covers all road traffic. Drivers, cyclists and pedestrians travel along roads, paths and streets knowing that, if an accident occurs and someone is hurt, insurance will be there to care for them and repair that damage. The insurance industry has in-depth knowledge of the reality of mobility and road accidents. That is why it is a firm defender of all measures that, from public authorities to civil society, are put in place to facilitate coexistence between the different methods of transport, including the new forms of personal mobility. The insurance industry will always be there, supporting prudence and the culture of prevention. Encouraging the existence of a protection and insurance framework that takes into account all the ways of moving.

Insurance carries the commitment to customer care in its DNA. For this purpose, it has all kinds of means and resources available. As well as telephone and internet service, it has an extensive network of face-to-face service points distributed all over Spain (own offices, brokers and bank branches, among others).

This proximity allows for the management of clients’ needs and effective handling of any request, consultation or incident they may have.

For more than 20 years, the insurance sector has had a first-rate customer care service that enables claims to be processed and resolved within 20 days.

In addition, insurance clients benefit from the reinforced protection that comes from being part of a regulated sector with specific legislation regarding the insurance contract and whose activity is supervised by the Directorate General of Insurance and Pension Funds (DGSFP, in Spanish).

For all of this, UNESPA considers that any general initiative regarding consumers must respect the distinctive and special features of the insurance sector, which, due to the special nature of its activity and extensive regulation, guarantees correct customer service.

Insurance is a supervised business activity. In other words, it is subject to supervision by public authorities. To provide the best service, insurance needs the best supervisors. The authorities must be able to understand the idiosyncrasy of this business and accompany it in its evolution. For that reason, the insurance industry advocates for a supervisor with the following characteristics:

• Independence: The insurance supervisor must be independent from political power to carry out its task of control based on strictly technical criteria, as set out in the recommendations established by international bodies.
• Capacity: The insurance supervisor must carry out important and sophisticated technical work. To do this, it must have suitable resources (economic, human and technological) to perform its job as effectively as possible and to be at the same level as the rest of the European supervisors.
• Specialisation: The financial sector covers many activities: granting of loans, asset management, insurance, methods of payment, etc. They are very different businesses. The dynamics they obey are very different. That is why insurance must have its own supervisor that specialises in the field and knows its determining factors. In short, insurance needs a supervisor that understands the nuances that define it and with which the industry can have a technical, educated and fluid dialogue.  Insurance consumers also deserve specific protection, as their needs vary considerably when searching for a certain financial product.

Insurance comprises the protection mechanism designed by human beings to protect themselves against natural catastrophes and man-made disasters. Insurance and reinsurance play a role when the most serious events occur. Earthquakes, floods, cyclonic storms, sea surges, volcanic eruptions, droughts, toxic spills, nuclear radiation, terrorist attacks, etc. Insurance covers all these risks.

Dealing with the economic consequences of natural and man-made disasters is in the interest of any developed society as these losses can be very high. In this sense, Spain is at the forefront of natural catastrophe insurance through a public institution, the Consorcio de Compensación de Seguros, which has amply proven its usefulness over the last half century.

However, in the face of such strong and unpredictable enemies as catastrophes, nothing is ever completely done. It is necessary to reflect on efficient prevention measures that allow for mitigation of the consequences of bad situations when they occur. Insurance will always support initiatives such as the construction of dams and breakwaters; the cleaning of riverbeds; the existence and application of strict building laws regarding earthquakes and rules that favour sustainable building that saves energy; protection of the environment with timely maintenance and scrupulous revision of nuclear power plants; the control of chemical plants and all kinds of centres that handle toxic or contaminating products; as well as the attentive care of water management infrastructure. In short, insurance will do everything it can to prevent a disaster from occurring or, if that is not possible, to minimise the damage caused by a catastrophic event.