80% use multinational pooling to control costs

More than 80% of respondents use multinational pooling arrangements as a means of controlling costs, according to research by the insurer network International Group Program (IGP).


Its research, which surveyed multinational employers at an international employee benefits seminar in Berlin, found that 40% of respondents use multinational pooling to gain and centralise control of their international benefits plans.

Other reasons for using a pooling network included access to general information about employee benefits and trends throughout the world, and access to information on claims.

The majority of European respondents said the potential savings resulting from using a multinational pool can be an important factor in controlling the high cost of employee benefits, while more American respondents use the information generated from pooling employee benefits plans to benchmark benefits.

American respondents have, on average, less than two pools, while those in Europe have an average of three.

The majority of respondents said they try to offer benefits that align with, or exceed, the local market standards in the countries in which they operate.

Many respondents balance local needs with the necessity for overall cost savings by using a combination of sign-offs and mandated preferred providers often linked to a pooling network. 

Nele Segers, account presentative at IGP Europe, said: “There are approximately 2,500 multinational pools worldwide, but in the UK, there are around 24,000 multinational employers, many with [Europe, Middle East and Africa] responsibilities, and 100,000 multinational employers worldwide. 

“Our survey attempted to find out what the drivers are for pooling and, while we clearly understand this is changing, what was interesting were the regional differences. 

“This insight from global benefits managers shows how risk management, oversight and governance on a global scale are coming to the forefront and illustrates the significant potential for increased pooling activity in the UK.”