Union Members of Verdi Vote Overwhelmingly to Approve Collective Agreement for Insurance, Securing Best Results in Three Decades
In a landmark decision, ver.di members in the insurance sector have approved a new wage agreement with an 85% majority. The agreement, which is seen as an important step towards further improvements, includes significant salary increases but faces challenges from rising social insurance costs.
The wage agreement provides for a 5.0% increase in wages from August 1, 2025, and a further 3.3% increase from September 1, 2026. However, these wage increases are partly offset by rising additional contributions to statutory health insurance. The increase in social insurance costs is due to higher health insurance fund expenditures driven by inflation surpassing wage growth.
For employees, this means that despite receiving a wage increase, a significant portion of these gains may be absorbed by higher social insurance costs, reducing the net benefit to workers. The agreement is crucial in maintaining wage growth within the sector but also highlights systemic financial pressures on social insurance providers that impact take-home pay and employer contributions.
The new wage agreement is considered the best in 30 years, according to ver.di negotiator Martina Grundler. In addition to wage increases, the agreement also covers topics like working conditions, working time, and co-determination. Trainees in the sector will receive an additional 250 euros in total.
The success of the agreement is attributed to the strikes and engagement of ver.di members. The term of the collective agreement is 26 months until May 31, 2027. The new wage agreement officially comes into force on August 1, 2025.
The collective agreement on transformation, aimed at protecting employees' interests in the developments of digitization and artificial intelligence (AI), has been agreed upon. Negotiations on a future collective agreement on transformation have also been agreed.
For the insurance industry and related sectors, the wage agreement stabilizes labor relations by securing worker approval and averting labor unrest. It also frames ongoing challenges for employers who face rising personnel costs not only from wages but from increased employer contributions to health insurance funds. This complex cost environment may influence future negotiations and the financial viability of social insurance systems linked to wage-based revenues.
In summary, the ver.di-approved wage agreement is a notable win for employees in the insurance sector in terms of wage increases, but these are partially eroded by rising social insurance contributions linked to inflation and systemic deficits in social welfare funding. This situation underscores the broader economic pressures faced by both workers and insurers in Germany amid inflationary and fiscal challenges.
- Employers in the banking, finance, and business sectors might experience financial pressures similar to those facing insurance providers, given the rising social insurance costs and the impact they have on take-home pay and employer contributions.
- Despite the significant wage increases in the insurance sector, employees may find their net benefits reduced due to higher contributions to statutory health insurance, a common issue across various industries.
