Conditional clearance for merger of insurance companies


On 5 November 2018, Danish insurance company Tryg Forsikring A/S received clearance from the Danish Competition Council for the acquisition of Forsikrings-Aktieselskabet Alka. The go-ahead was given after Tryg had undertaken, among other obligations, to cancel exclusivity requirements in a number of trade union agreements and to do away with termination fees on private non-life insurance policies.

By economist Thomas Andersen

Tryg and Alka are both providers of non-life insurance for private customers. Apparently, the Danish Competition Council, after conducting usual market investigations, found that Alka had been acting as a kind of “maverick” on the Danish market for non-life insurance to private customers, offering low prices and innovative measures. The DCC, however, avoided using the term "maverick" (probably because Alka had not gained significant market shares during the last couple of years).

The Council therefore voiced concerns over Tryg’s acquisition of Alka. To accommodate these concerns Tryg has agreed to certain commitments, and the transaction has now been given a green light.

The commitments

Tryg has agreed for a period of five years to:

  • cancel the exclusivity agreements in Alka’s trade union agreements and five of Tryg’s partnership agreements;
  • refrain from charging fees or similar payments from private consumers terminating one or more private non-life insurance policies with Tryg or Alka; and to
  • pay an amount of DKK 5 million annually to Forsikringsguiden, an on-line consumer guide that compares insurance companies. 

With the transaction completed, Tryg will be the biggest non-life insurance company on the Danish market.

Click here for the Danish Competition Council’s press release and decision (in Danish).