L’Argus de L’assurance took stock of the list of legal actions that Covéa is about to undergo. The group says it is in no way worried, its spokesperson noting on BFM Business, that the mutualist group Crédit Agricole having recently acquired more than 9% of an Italian bank, the insurer does not see how the takeover of the re- insurer Partner Ré would receive different treatment. However, the group’s strong mutualist values would be the cause of a lifting of disputes from members, potentially despoiled. At least that’s the opinion of some.
Association for the Safeguarding of Mutualists (ASPM)
For Mr. Calmels and the Association for the Safeguarding of Mutualists (ASPM) which he has just set up, ” the war chest accumulated by mutuals should be paid back to members via a reduction in premiums rather than being used to finance acquisitions. And if he says he can understand that a Cac 40 company is going to grow abroad “, he finds ” shocking for a mutual to do the same. The mutualist group, we recall, will pay in cash some €9 billion (around €7.8 billion) for the acquisition of PartnerRe, which should be completed by mid-2022.
Appeal to the ACPR
At the end of February, Mr. Calmels initiated a first action against the takeover of Partner Re by Covéa via an appeal to the Prudential Control and Resolution Authority (ACPR), in which the ASPM joined. This action is based on several grounds, including in particular the fact that PartnerRe pursues a global reinsurance activity for risks unrelated to those covered by the mutual insurance companies of the Covéa group. The ACPR has not yet responded. If the regulator does not respond within two months, Mr. Calmels and the association have the right to appeal to the Council of State, which they intend to do. It should be noted that the Bermudian and American insurance regulators have also been seized.
Judicial court procedure
A summons to the merits of Sgam Covéa and its various mutuals (MMA, Maaf and GMF in particular) was also filed last week with the Paris Court of Justice with two requests. The first concerns the prohibition of this repurchase operation. ” Judicial time will certainly be longer than business time. There will certainly not be a decision rendered in June, at which time the takeover should be completed. We therefore requested that the operation be canceled if it was carried out in the meantime. “, specifies Me Olivier Dillenschneider, founding partner of the firm Hugo Avocats, in charge of the file.
The summons relates to a second point: We ask that it be found that the organization of the Covéa group does not comply with the insurance code, because most of the resources are housed within Covéa Coopération, which is a commercial company. The rule that surpluses generated by operations must be returned to members in the form of premium refunds is not respected “, explains the lawyer of Didier Calmels. This poses a problem because “the vocation of a mutualist group is not to generate profit for shareholders”. ” There, the surpluses are used to buy out a Bermudian group “, he adds. Another argument: the insurance code also says that a mutual can carry out a commercial activity, but only on an ancillary basis. ” But an investment of €9 billion is not at all incidental “, notes Me Dillenschneider again.
Misleading commercial practices
A third appeal, criminal this time, is being drafted on the grounds of deceptive commercial practices. The contracts of Maaf, MMA or GMF, are certainly presented as mutualist. But according to Me Dillenschneider, the guarantees of an MMA housing contract, for example, are carried by MMA Iard, which is a mutualist, and other guarantees – which would be the majority – by MMA Iard Assurances, which is a commercial company. ” Members subscribe under the mutualist screen, with communication on the fact that Covéa is a committed group, and in fact the reality is different “says Me Dillenschneider. This third appeal should be filed at the latest in the first days of April.