In 2018, the sum of insured turnover of Polish companies exceeded, for the first time in history, PLN 0.5 trillion and was 10% higher than in the previous year. The total amount of insured receivables is approx. PLN 157 billion, i.e. 9% more than in 2017.
According to data from the Polish Chamber of Insurance, the involvement of Polish insurers in supporting exports has increased considerably. The growth rate in the coverage of export loans amounted to 112%. Last year, Polish companies increased their exports considerably, resulting in demand for this type of insurance. However, the value of insured domestic receivables decreased from PLN 105 billion to PLN 101.7 billion. The reason for the decrease is the deteriorating financial situation of companies, despite high GDP growth last year. Many companies are unable to compensate for increased business costs with higher prices. In January this year, 98 companies were insolvent, which represents an increase of 20% YoY. In February this year, 47 bankruptcies were declared. ‘Payment backlogs are increasing, which is reflected in the risk management policy in insurance companies’, said Rafał Mańkowski, expert analyst at PIU.
Although the value of compensation payments decreased in 2018 (by 8%), some insurance companies established higher provisions for future payments. ‘The financial standing of businesses is deteriorating and this may result in higher compensation payments in 2019’, explained Rafal Mańkowski.
Trade credit is a more important source of short-term financing for businesses than short-term bank loans. This is also visible in the insurance sector. The national exposure of receivables insurance at the end of December last year was higher than the total amount of short-term loans granted by banks.
|Amount (PLN million)||2017||2018||YoY dynamics (%)|
|Domestic exposure (as at 31 December)||105 168||101 729||97|
|Export exposure (31 December)||49 254||55 208||112|
|Total exposure (31 December)||154 422||156 937||109|
|Insured domestic turnover||358 953||399 512||111|
|Insured export turnover||98 139||105 389||107|
|Total insured turnover||457 092||504 901||110|
|Gross premiums written||550||612||111|
|Gross compensation and benefits paid||407||374||92|