Germany’s OVB seeks to stop staff exodus

COLOGNE-based financial sales company OVB is planning to take legal action to put an end to the haemorrhage of agents. Around half the OVB agents in Switzerland and the majority in France have left the company, a total of 36.

One reason seems to be the establishment of a new business headed by the son of former OVB-boss Michael Frahnert. Frahnert was forced to resign suddenly from his position in 2009 following accusations of disloyalty by several of OVB’s owners, which include Deutscher Ring, Signal Iduna and Generali. The number of agents is falling even without specific rivals taking teams of individuals, particularly abroad. OVB had 4,700 agents at the end of 2009 compared with 5,000 in 2008.

OVB is suffering from the general decline in demand for insurance not only in Germany, but mainly in its eastern European markets. The company is trying to avoid further defections with high premiums paid to agents, and also retention programmes.

Alongside the general market decline, OVB salespeople are worried about the conflict between two of its owners. The company has become entangled in the struggle between Swiss insurer Baloise and Signal Iduna, the German mutual.

Baloise says it controls the majority of OVB. However, this is partly done through a subholding, in which a former group member, the mutual Deutscher Ring Kranken, also participates. Baloise wants to cut ties with DR Kranken while keeping control of its life and p/c company Deutscher Ring Leben und Deutscher Ring Sach. OVB has frequently been mentioned as a possible bargaining instrument – should one side give up control over its part of the Deutscher Ring group, it would get OVB in return.