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Sep 2, 2017,  by Allianz Partners Business Insights

Home insurance: Nantes french city testing innovative way of easier access for the less well-off

First it was mutual health funds, now the city of Nantes in western France is trying to provide greater access to home insurance for those of its inhabitants who are the least well-off. The municipality has negotiated a group rate with an insurance company to enable it to offer a preferential price for up to 4,000 people in the city, many of whom simply cannot afford to insure their homes.

The city of Nantes in western France recently issued a call for tender for a partnership with insurance companies.

The aim is to help the municipality to enable several thousand of its least well-off inhabitants benefit from a basic level of coverage for their homes at the lowest possible price, as of this coming October. The city has joined forces with the neighbouring towns of Saint-Herblain and Rezé to get the best available group rate.


Fighting against the lack of home insurance for financial reasons


Eventually almost 4,000 people could be offered this service – all of whom currently are so short of financial means that not insuring their home has had to become an option.

"The idea is that the beneficiaries get into the habit of having home insurance and that they realise the advantages that they can gain from it," said Abbassia Hakem, deputy mayor of Nantes (Socialist Party) who is responsible for solidarity and inclusion, to Le Parisien newspaper. "When people experience financial difficulties, this type of insurance is the first thing to go, along with leisure activities." According to the newspaper, between 5% – 8% of the 4 million people who rent social housing in France have decided not to insure their homes.


Civil liability may also be added


Nantes has asked those insurance companies who expressed an interest in taking part to include a wider range of minimum-cover policies, including fire and water damage. Civil liability may also be added, and is currently being looked into.

The municipality is hoping that this will be a win-win situation. Local inhabitants will get rates that are on offer nowhere else, insurance companies will have access to a new client base, and local areas will have a way of combatting the number of people who waive their right to insurance.



Family quotient the deciding criterion


The family quotient will be the criterion when it comes to deciding which people from Nantes will be able to benefit from this project, which follows on from a similar initiative launched two years ago by Nantes city hall to increase the number of its inhabitants with additional health care.

Again, mutual companies were asked to provide an offer that the locals would be keen to take up, and just under half of those who were informed of the possibility of reduced-price cover decided to get on board. This cover is now set to be altered to target retirees and the unemployed, who by definition cannot get company-based health cover, which has been compulsory in France since 1 January 2016.


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