Results of the insurance market after Q4 2015

In 2015, Polish insurers paid life insurance benefits worth PLN 19.3 billion and non-life insurance compensations and benefits worth PLN 15.5 billion. A dramatic increase in payments in motor civil liability insurance (OC) caused that the result achieved in this type of insurance was the worst in history.

Interesting data for 2015

  • The total premium in the insurance market amounted to PLN 54.8 billion (YoY decrease by 0.23%)
    The total compensations and benefits paid amounted to PLN 34.8 billion (YoY increase by 2%)
    Compensations and benefits under civil liability insurance (OC) of land vehicles (including civil liability insurance of motor vehicle owners) amounted to PLN 6.8 billion (an increase by 15.8%) This is the highest amount in the history of insurance in Poland
    The net profit of insurers amounted to PLN 5.7 billion and was by 14.3% lower than a year before.

Motor insurance market
Key figures:

  • The gross written premium on motor civil liability insurance (OC) amounted to PLN 8.2 billion (an increase by 1%)
    The gross written premium on comprehensive Auto Casco (AC) insurance amounted to PLN 5.5 billion (an increase by 3.7%)
    The technical loss on motor civil liability insurance (OC) amounted to over PLN 1 billion – the highest in history
    The technical loss on comprehensive Auto Casco (AC) amounted to PLN 113.8 million

Guidelines of the Polish Financial Supervision Authority (KNF) on the adjustment of claims and a considerable increase in payments in personal damages contributed to the greatest loss in the motor civil liability insurance (OC) in history. Recently, the prices of the civil liability insurance (OC) have been rising, but companies are slow in increasing premium rates. Any rapid step may cause an outflow of customers to another insurer, which, naturally, every company wants to avoid. It will be very difficult to restore the balance on the motor civil liability insurance (OC) market, because payment amounts will continue to increase, and without appropriate regulatory decisions the process will be uncontrolled and unpredictable. In light of the above, the heralds of a new tax connected with treatment of victims of accidents raise concerns. Burdening the motor civil liability insurance (OC) with a new tax may cause a dramatic price increase, which in turn may contribute to the increase in the number of people driving without OC. Already today there are about 250 thousand of such people on Polish road, says Jan Grzegorz Prądzyński, CEO of PIU.

Non-life market (Section II exclusive of motor insurance).
Key figures:

  • The total premium on non-life insurance (exclusive of motor insurance) amounted to PLN 13.7 billion and was higher by 5.7% than a year before.
    On the non-life insurance market, the premium increase is caused, to a great extent, by an increase in active reinsurance (by as much as 160%).
    The following types of insurance have the biggest share in the premium on the non-life market: insurance against fire and other natural forces (PLN 2.9 billion, YoY decrease by 0.1%), insurance against other property damage (PLN 2.5 billion, increase by 1.4%) and motor civil liability insurance (OC) (PLN 2 billion, YoY increase by 4.8%).

Life insurance market
Key figures:

  • The value of the life insurance premium decreased by 4% to PLN 27.5 billion
    The value of the premium on insurance with ICF increased to PLN 13 billion (by 3.1%)

Financial results of insurers

The net profit of life insurers for 2015 amounted to PLN 3 billion and was by 3.4% higher than a year ago. Non-life insurers ended 2015 with the profit of PLN 2.7 billion (a decrease by 28.5%). The technical result on life insurance amounted to PLN 2.8 billion and was by 13.4% lower than a year before. The technical result of non-life insurers amounted to PLN 351.4 million and was by 55.8% lower than in 2014. The income tax due from Polish insurers for 2015 amounted to PLN 800 million.