The discussion about a higher retirement age is strongly influenced by the fear of unemployment. In the insurance industry, however, the picture is contradictory: employees over 55 are well protected as long as they keep their job and there is no merger. If they lose them, there is a risk of career termination shortly before retirement.
On March 3, Swiss voters will vote on a popular initiative by the Young Liberals, which aims to gradually raise the normal retirement age to 66 and then automatically link it to rising life expectancy. Specifically, the reference age should rise by 80 percent of the increase in life expectancy in future. The aim of the proponents is to secure the financing of the AHV in the long term without reducing pensions or increasing contributions, as significantly more people will be drawing pensions in future and these will have to be paid out for longer due to longer life expectancy.
The Federal Council, parliamentary majority and trade unions reject the initiative. They argue that funding is stable in the short term and should not be controlled solely by the retirement age. Furthermore, an automatic system would not take sufficient account of the labor market or the social reality of older employees. While conservative parties and the business community support the model, opponents point out that structural reforms would have to be more broadly based and that political leeway would be lost.
The real concern behind the pension debate
In the industry, the rejection of a higher retirement age has less to do with political attitudes than with a very specific risk: losing your last job. Those who are made redundant shortly before retirement have significantly lower chances of finding their feet again. Insurance companies are an exemplary labor market for this. Many employees work for decades in highly specialized functions, for example in underwriting, claims settlement or corporate customer business. Their experience is valuable, but strongly tailored to a specific business model.
If this business model changes, for example due to automation or new sales channels, it is precisely this specialization that becomes a problem. The question is therefore not whether older employees are capable of performing. The crucial question is whether they will be hired again after a layoff.
High stability within – high hurdles outside
Insurance companies are traditionally among the most stable employers of all. Employees over 55 lose their jobs significantly less often than younger colleagues. Companies benefit from their experience, particularly in complex claims cases, regulatory issues and long-term customer relationships. Many processes only work smoothly because there is implicit knowledge that is not in any manual.
But this stability has a downside. If the employment relationship is terminated, the job search takes much longer. The market for insurance profiles is small and highly segmented. An actuary or an experienced claims expert cannot easily switch to another sector. At the same time, new roles are being defined in a more technology-oriented way. This creates a paradoxical pattern: older employees have very high job security but a very low reintegration capacity.
Mass redundancies at Helvetia
Although the insurance industry is one of the most stable employers, the merger between Helvetia and Baloise is a different story. The newly merged insurance group Helvetia plans to cut between 2,000 and 2,600 jobs over the next three years. In Switzerland, between 1400 and 1800 jobs will be affected. Hundreds of these are to lose their jobs in the first wave of redundancies that has now begun, including many over 50. The job cuts will begin in February, with the next wave to follow in May.
Between skills shortages and cost logic
The insurance industry is facing a demographic shift. In the coming years, large cohorts will retire, while at the same time there is a shortage of qualified young talent. Companies know that they need experience, but they do not always act accordingly. Recruitment is often dominated by the cost perspective. Older employees are seen as expensive, less flexible or more difficult to adapt technologically.
Operationally, however, the opposite is often the case. Particularly in claims processing or corporate customer business, experience reduces wrong decisions, shortens negotiations and stabilizes customer relationships. Many insurers save on personnel costs in the short term and lose productivity in the long term. It is not uncommon for this knowledge to be bought back later at a high price in the form of external consulting.
Automation changes tasks, not necessarily needs
Digitalization is adding to the uncertainty. Automated policies, AI-supported claims processes and data-driven pricing give the impression that experience is becoming superfluous. In fact, the requirements are shifting. Standard cases are being handled less frequently by people, while borderline cases are becoming more complex. And this is precisely where the value of experience is increasing.
The problem lies less in the displacement than in the lack of transformation. Those who have held the same position for decades are often given the opportunity to develop new skills too late. The fear is therefore not primarily caused by technology, but by the lack of transitions within a career.
The last notice decides
This makes it clear why the retirement debate is so emotional. Statistically, older employees have a good chance of staying in their jobs until retirement. However, the consequences of redundancy are more serious than in any other age group. The real uncertainty does not concern the duration of the employment phase, but the final phase of the employment biography.
As long as companies do not create realistic follow-up roles for late career stages, resistance to a higher retirement age will remain understandable. The industry is faced with the task of not only starting and developing careers, but also shaping them to the end.
Insurance industry needs experience
For insurers, dealing with the 55+ generation is becoming a strategic issue. The industry needs experience more urgently than is reflected in its recruitment and cost logic. The retirement age is only a political framework.
The real challenge is to actively manage late careers. It is not how long people can work that determines the acceptance of reforms, but whether they realistically have a perspective until the end of their working life.
Binci Heeb
Read also: When age becomes a disadvantage – but could be different
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