PALFINGER: Pioneering In Employee Benefits Insurance

Gregor Sterrer is Group Insurance Manager at PALFINGER AG with over 13 years of experience in insurance management. He holds a degree in Economics from Johannes Kepler University Linz and has worked with multinational corporations and insurance brokers, delivering effective risk and insurance solutions.

International companies typically manage employee benefits locally and independently due to varying local requirements and legal frameworks. As of 2025, PALFINGER will be the first Austrian company to collaborate with a global insurance broker in this area.

Initial situation

Around one and a half years ago, we, PALFINGER, an international company and the world’s leading producer and provider of innovative crane and lifting solutions, with headquarters in Austria, decided to explore the potential of using a global insurance broker for our employee benefits portfolio.

The main reasons for this step were

• Creating transparency regarding our global employee benefits insurance portfolio.

• Leveraging substantial savings by implementing a centralised placement strategy and risk financing methods.

• Regular reporting on the contract portfolio and claims development by the broker.

The internal data collection for the tender and the final decision for a brokertook four months. The appointment was made in August, just in time to give the new broker enough time to organise the local transitionsand manage the renewal of all insurance contracts starting January 1st.

Collaborating with a global employee benefits broker was definitely the right decision.

The main benefit, leveraging savings, is clear. A multinational company like us, with around 12,350 employees with 30 manufacturing sites worldwide, can save significantly by using a global broker. But what are the key success factors? What hurdles do we encounter along the way? And most importantly: is it worth the effort?

After the first internal discussions, a few things became very clear:

• Employee benefits are a very sensitive and important topic in many countries, in contrast to their significance in Austria.

• A headquarters decision to mandate a global broker in this area leads to disruption on a local level, predominantly to the termination of established long-term broker relations.

• Support from our HR organisation, from the CHRO to local colleagues, is crucial for the project's success.

• The current and further expected medical inflation will drive up the costs for medication and medical treatments, negatively impacting insurance premiums for the years to come.

• Establishing a partnership with a global broker is a multi-year project.

Consequently, we focused on involving the local responsible persons from the very beginning. The first Q&A calls were organised before the data collection, laying out the goal of this endeavour as well as the further course of action and explaining the information requirements as a basis for the tendering process in detail.

9 months into the partnership with our new broker

The initial phase of the collaboration is especially time-consuming, as a lot of coordination between all involved stakeholders (the broker’s and our central and local teams) is required, next to agreeing on the contractual frameworks and setting up guiding principles of the partnership.

Simultaneous local broker transitions for a variety of entities obviously do not come without any friction. Whereas this process went smoothly for us in most countries, in some cases establishing the collaboration with the new broker needed some assistance. In this regard, from our point of view, it is very purposeful to proactively ask for feedback from the local entities. As insurance is mostly a smaller part of the responsibilities of a local HR manager, the threshold for contacting the HQ may only be reached at a time when it is no longer possible to successfully intervene together with the broker’s steering team.

As the transition from the incumbent brokers had to happen quickly to not miss any of the upcoming renewals, the early involvement of the local HR teams turned out to be a very important factor.

Interim Conclusion

Centrally managing a project of this kind requires a lot of dedication. Before initiating such a venture, having a clear idea about the objectives and getting all internal stakeholders on board is of utmost importance. Consistent support from the C-level and no possibility for local entities to opt out is vital to achieving the goal of mandating the broker locally at the earliest possibility in each case (this usually takes 3–5 years for companies comparable to us based on the experience of our broker).

After 9 months into this new partnership, we are convinced that collaborating with a global employee benefits broker was definitely the right decision. Although continuous efforts on all levels will further be required, the desired advantages have already come to fruition. This new setup will give us the possibility to manage our employee benefits portfolio proactively and with foresight and to counteract the anticipated inflation-driven premium rate increases.