For the third year in a row, the neo-insurance company Luko is donating the excess contributions of its 400,000 policyholders to partner associations. This year, €126,688 was donated as part of the Giveback, a new, more virtuous and transparent remuneration model that breaks the conflict of interest in insurance by donating the remaining part of the premiums to partner associations after all the claims from the previous year have been reimbursed. The funds help to support causes chosen by the policyholders, by financing solidarity housing projects, inclusive training in technology, as well as the fight against climate change through initiations to agroecology.
Restoring the contract of trust, while maximizing its social and environmental impact
Reversing the traditional insurance model where the insurer is both judge and jury each time it has to compensate one of its policyholders, Luko has opted since its creation for a unique remuneration model in France:
30% of the policyholders' contributions are used to pay Luko (employees, premises, R&D, etc.)
The remaining 70% is paid into a common fund dedicated to the reimbursement of policyholder claims
If there is any money left in this pool at the end of the year after all claims for the past year have been paid, the balance of the pool is paid to the associations chosen by the policyholders. In this way, Luko guarantees the independence of its remuneration from the reimbursement of claims and restores the confidence of the insured and the insurer, because a euro that is not reimbursed to the insured is not an additional euro of profit for the insurer. By combining this with increasingly efficient management tools that optimize the ratio between premiums and claims costs, neo-insurance proves that it is possible to reconcile economic performance with a commitment to solidarity.
According to Raphaël Vullierme, CEO of Luko, "Giveback is first and foremost about re-aligning interests and getting both parties on the same team. How does it work? By signing a contract of trust: on the one hand, Luko commits to reimbursing claims solely on the basis of the facts, rather than on the basis of its financial results; on the other hand, our members become more involved in preventing their risks. It's a win-win situation, with a positive impact on society extended through these donations and work with associations."
A proven model
The positive results of the Luko Giveback attest to the solidity of this model anchored in a virtuous circle logic, at a time when tech companies are posting contrasting results. For the year 2021, €126,000 of surplus will be donated to the 6 associations chosen by Luko policyholders in France, Germany and Spain. This is €24,000 more than last year. These good results can be explained by
good technical results: in 2021, Luko had fewer claims to pay out than premiums collected, because the neo insurance company has developed effective tools to prevent risks, optimize claims management and thus reduce costs. The creation of a network of partner craftsmen, the implementation of a claims automation system, the "Doctor House" home teleconsultation service, and other initiatives have helped prevent and limit the cost of claims.
Luko's portfolio growth: between 2020 and 2021, the number of customers doubled from 77,000 to 146,000. Dynamic growth, fueled mainly by organic growth: 1 out of every 2 policyholders comes directly to the site or via recommendations from friends and family. Luko has reached 400,000 policyholders again this year, and as it continues to grow, it is benefiting from an increasingly strong portfolio to maximize its impact.
To learn more about the causes and projects funded, go here.
The plebiscite of users, especially the youngest
The French are increasingly attentive to the social and environmental commitments of their insurance policies, starting with home insurance, which is the insurance policy most concerned with these issues for 88% of consumers, especially young people. 61%1 of 18-24 year olds and 25-34 year olds are attentive to the social and environmental responsibility of their future insurer before choosing it.
Insurers are struggling to put CSR issues at the heart of their model: only 31%1 of French people believe that insurance companies are "responsible". A commitment that Luko intends to pursue, according to Raphaël Vullierme, CEO of Luko: "Our homes are a key element of our lives: we spend more and more time in them, they are our largest expense item and also a significant part of our carbon footprint. Conversely, our homes are also threatened by new risks, due to climate change, and insurers have a key role to play in ensuring our future. That's why, from the very beginning, Luko's mission has been to make millions of European homes safer and healthier, so that we don't lose sight of the challenges of tomorrow.
Now its own risk carrier after acquiring its insurance license in January 2022, Luko is in a better position than ever to evolve its business model and continue to work towards ever greater engagement and transparency in the market.
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