The latest report from the Polish Chamber of Insurance, “Life insurance. Financial support in the most difficult moments”, prepared in cooperation with Milliman Polska, confirms that Poles’ interest in solutions that provide financial support to their loved ones in case of death or illness of the family breadwinner is growing. After three quarters of 2024, we spent almost PLN 18 billion on life insurance policies. This is 4% more than the year before. The popularity of investment products is also increasing.
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Recent years have particularly shown that health and life protection are paramount values that are worth caring for. Life insurance is one of the most reliable ways to protect against the negative financial consequences of various events, such as serious illness, accident, disability or death. Such policies also offer the possibility to finance specific medical benefits, and in the long-term perspective help save money, including for retirement or such goals as studies or housing for children.
– Life and health protection are the most important values associated with our main concerns. Over 85% of Poles fear serious illness of their loved ones, and over 80% fear that they may then lack money for treatment. Almost 85% also fear the death of a loved one. It is therefore no wonder that life insurance is steadily gaining popularity. Our report “Life insurance. Financial support in the most difficult moments” shows how important a tool of financial protection in difficult moments these insurances are and what an important function they play in building social stability – says Jan Grzegorz Prądzyński, President of the Management Board of the Polish Chamber of Insurance.
The life insurance market in Poland
In Poland, 23 million people have life insurance, both in individual and group form. We spent PLN 17.7 billion on such policies after three quarters of 2024. In the same period, insurers paid PLN 12.2 billion in life insurance benefits. PIU has noted a decrease in payments, which mainly reflects the decrease in mortality after the pandemic.
Despite the steady growth in interest in these insurances, the phenomenon of underinsurance still occurs. This situation is slowly improving, but Poland still lags behind compared to Western Europe. The life insurance market there is much more developed, and moreover life insurance in many countries benefits from numerous systemic incentives.
– Similar practices are essential to introduce in Poland to promote long-term saving and life and health protection. It is also necessary to equalise the operating conditions of insurance companies and other financial institutions regarding the tax on assets. Changes are needed so that this market in Poland develops at a faster pace – comments Jan Grzegorz Prądzyński.
Insurers, through their activities, also support the Polish economy. Offering long-term insurance products, they can contribute to investment development, especially those related to infrastructure development, energy transformation and climate protection. In Europe, insurance-based investment products constitute the largest part of retail investments (70%).
What kind of insurance do Poles need?
In a recent report entitled “Poles and Risk – How we insure ourselves? Insurance gap in Poland”, PIU showed that the life sum insured should not be lower than an amount allowing to secure the repayment of a given person’s liabilities and three years of net income adjusted for their savings amount. However, it is worth emphasising that the situation and security needs of each family will differ. The life policy sum must therefore be determined individually.
– Money from insurance helps survive the most difficult moment after the death of a family member or in case of serious illness in the family. It allows to repay credit, maintain a flat or house, continue children’s education or simply get back on one’s feet after a difficult event. More and more people see life insurance as a safe form of investing household budget surpluses and long-term saving that will be support in retirement – adds Jan Grzegorz Prądzyński.
– In the report we showed what to pay attention to when choosing life insurance. We analysed insurance risk for individual age groups, indicating in detail when it is greatest, what Poles die from and what serious illnesses they face. The report contains simplified needs schemes for individual age groups, which can be a valuable guide for people interested in these products – says Marcin Krzykowski, partner at actuarial consulting firm Milliman, which prepared the report commissioned by PIU. – We showed, among other things, that term insurance best secures credit liabilities where there is a limitation in the form of repayment term. They can also be used in a particular period of one’s life, e.g. during children’s minority, or until they finish education. They also allow the realisation of specific saving goals, including retirement security. Whole life insurance, on the other hand, allows securing death risk for unlimited time – he adds.
| When choosing insurance and determining its sum, one should consider the number of people in the household – whether we are securing only a spouse/partner, children, or perhaps also parents whom we financially support, the level of income, fixed expenses and expected financial cushion, the size of credit liabilities and their security in case of death or illness, and saving goals (e.g. education and financial security for children). |
It is worth caring for life and health
Report entitled “Life insurance. Financial support in the most difficult moments in life” clearly indicates that the health condition of Polish society is not the best.
According to Statistics Poland, in 2022, 448,000 people died in Poland. That is an average of 9,000 people per week. Mortality fell compared to the pandemic period – in 2021 this number was 520,000. OECD data show that in 2023 in the European Union the average life expectancy of a man was 78.9 years, and in Poland 74.8 years, while for women 84.2 and 82.4 years respectively. Average life expectancy is extending both in Poland and in Europe. The time we will remain healthy is also an important indicator. Statistics Poland warns that on average we will not be ill only for half of our retirement.
The PIU report indicates that one quarter of men will not live to retirement (65 years), while half to 75 years of age. One quarter of women will not live to 75 years of age. 93% of them will reach retirement (60 years). Half of women will live to 83 years of age, and one quarter to over 90 years.
PIU analysis shows that up to 50 years of age, the most frequent cause of death are external factors such as accidents, suicides and effects of crimes, while later – cardiovascular diseases. Their share in the total number of deaths increases with age (from 21% in the 50-59 age group to 54% in the 90 and over age group). Moreover, experts listed three most frequent causes of death, regardless of age: apart from cardiovascular diseases, these are cancers and respiratory diseases. For women from 30 years of age, it is malignant cancers that are the most frequent cause of death. In the 30-39 age group they account for as much as ¼ of deaths.
In recent years, the mental health of Poles has also significantly deteriorated.
– In the current demographic situation of Poland and Europe, motivating consumers to long-term saving related to life insurance seems crucial. All the more so because the development of the life insurance market leads to building long-term insurance liabilities that can be invested in long-term assets. And this will favour economic development, energy transformation and increased competitiveness of Poland and Europe – summarises Jan Grzegorz Prądzyński.
