sueddeutsche.de
Deutsche Telekom Creates Captive Insurer to Combat Rising Premiums
Deutsche Telekom is establishing DeTeAssekuranz, a captive insurance company, to address rising premiums from traditional insurers, investing over €50 million to manage its €100-150 million annual insurance costs, following a trend among large corporations facing similar economic pressures.
- How does Deutsche Telekom's decision relate to broader trends within the industry, and what are the factors influencing this choice?
- High insurance premiums, exacerbated by a weak economy, are driving industrial companies to create captive insurers. Deutsche Telekom's decision reflects this trend, motivated by the increasing costs and dissatisfaction with current insurer practices, especially regarding the lack of premium reduction despite significant investments in risk prevention. The new captive aims to influence pricing and coverage within insurance consortia, securing better terms for the Telekom and its subsidiaries.
- What is the primary reason behind Deutsche Telekom's creation of its own insurance company, and what are the immediate consequences?
- The Deutsche Telekom is establishing its own insurance company, DeTeAssekuranz, to counter rising insurance premiums. This follows a trend among corporations like BMW and Siemens seeking alternatives to high costs from traditional insurers. The new company will be capitalized with over €50 million, aiming to manage a significant portion of the Telekom's €100-150 million annual insurance premiums.
- What are the long-term implications of Deutsche Telekom's decision for its risk management strategy and the broader insurance market?
- Deutsche Telekom's establishment of DeTeAssekuranz signifies a potential shift in corporate risk management strategies. The decision to locate the captive in Germany, despite Luxembourg's tax advantages, highlights the political considerations for a partly state-owned company. This long-term strategy underscores the growing importance of captive insurers in mitigating escalating insurance costs for large corporations, impacting future industry trends.
Cognitive Concepts
Framing Bias
The framing is generally positive towards the Telekom's decision. The headline (if one existed) would likely emphasize the proactive nature of the move and the cost savings. The article highlights the company's response to high premiums and its investment in risk prevention, portraying the decision as a strategic and financially sound one.
Language Bias
The language used is mostly neutral, although phrases like "verärgert sind Unternehmenschefs" (company bosses are annoyed) and descriptions of premium increases as "kräftigen Preissteigerungen" (strong price increases) could be considered slightly loaded. More neutral alternatives would be 'company executives expressed concern' and 'significant premium increases'.
Bias by Omission
The article focuses primarily on the Telekom's decision to establish its own insurance company and the industry trend it follows. However, it omits discussion of potential downsides of creating a captive insurer, such as the administrative overhead and expertise required. It also doesn't explore alternative risk management strategies the Telekom might have considered. While acknowledging space constraints is valid, a brief mention of potential drawbacks would have provided a more balanced perspective.
False Dichotomy
The article presents a somewhat simplified view of the situation, implying that creating a captive insurer is a straightforward solution to high premiums. It doesn't fully address the complexities of risk management or the potential for unexpected challenges.
Sustainable Development Goals
By establishing its own insurance company, Deutsche Telekom aims to mitigate the impact of rising insurance premiums, a cost that disproportionately affects smaller companies. This move could lead to a more equitable distribution of insurance costs within the industry and potentially reduce the financial burden on smaller businesses.