Poland's € 15 billion insurance sector – Growing profitability and positive outlook

Posted December 30, 2019 by Inteliace

“The profitability of insurers operating in Poland has been growing steadily for a few years with ROAE exceeding 20% in 1H 2019 in both life and non-life segments” said Marcin Mazurek, director of Inteliace Research

Poland has the largest insurance sector in the CEE with nearly € 15 billion in premium written p.a. and a 40 % share in the CEE14 region. Premium in the non-life insurance segment in Poland jumped by 7% in 2018 and by 3% in 1H 2019, and it is expected to top PLN 42 billion by year end 2019. By contrast, the premium in the life segment continued to decline, falling by nearly 12% in 2018 and going down again by another 3% in 1H 2019.

Recent years have been particularly challenging for life insurers as the regulatory developments and disclosure rules have changed the way life products are distributed. This led also to significant changes in market shares as less adaptive players lost the business while more flexible players gained market share and reinforced their position. Increasing regulatory pressure has also triggered the market consolidation. After multiple M&A transactions recorded in 2018, there are new deals upcoming with the recently speculated withdrawal of AXA. The ongoing consolidation in the insurance sector is for sure taking out some pressure from the market in terms of pricing and tariffs as well it is helping to increase the scale of operations for the survivors.

Both, life and non-life insurers have seen improving profitability in 2018 and in the first half of 2019. This has been primarily an effect of increasing automation and a better cost control. The combined ratio for non-life insurers (CR) remained below 90% on average while it stood below 96% in both TPL** and Casco car insurance. The overall net profit of non-life insurers increased to 4.2 billion as of 2018. Similarly, a favourable trend in profitability could be observed within the life insurance sector. Despite falling premium written, life insurers managed to improve the bottom line to PLN 2.4 billion.

The mid-term outlook for insures operating in Poland remains positive, although there are multiple challenges ahead. Within the non-life segment, a further automation of processes and a more advanced risk assessment will be key to stay ahead of competition. Also the increasing consolidation and withdrawal of players who aggressively undercut prices (e.g. AXA - car TPL) will provide some relief in terms of tariffs.
Within the life insurance segment, the premium income is expected to stabilize as insurers adjust their product and service portfolio to a new regulatory regime.

For more information on recent developments in the Polish insurance sector, please refer to the publication “Insurance Market in Poland, 2019-2021” at:

About The Report
“Insurance Market in Poland, 2019-2021” is the latest update of our comprehensive publication about the banking sector in Poland. It describes the present market structure and recent trends in the market and also provides short-term estimates of key banking through 2021. When preparing this report, Inteliace Research responded to feedback received from its clients. Compared to the previous edition, it has been fully revised and updated.

About Inteliace Research
Inteliace Research is an independent consulting company that focuses on the financial markets in Central and Eastern Europe. Inteliace Research specializes in management consulting and custom research services, including market-entry strategies, product launches, and performance and benchmarking analyses.

During 2005–2019, Inteliace Research provided its products and services to more than 70 clients, including major CEE insurers and banks. To learn more about the company, visit Inteliace Research’s webpage: www.inteliace.com.

Table of contents

Slide 1: Executive summary

1. Macroeconomic overview
Slide 2: Poland - General overview
Slide 3: Poland in Europe: Number of households vs. wealth, 2018
Slide 4: Key macroeconomic indicators, 2014-2019F
Slide 5: Foreign trade statistics, C/A, FDI, 2014-2019F
Slide 6: Unemployment and salaries/wages, 2014-2019F
Slide 7: Disposable income in households and income distribution, 2014-2019F; Income distribution 2018
Slide 8: Consumer confidence index evolution, Dec. 2013 – Nov. 2019
Slide 9: Warsaw Stock Exchange - Turnover, Market cap. and indexes, 2013-2018
Slide 10: Banking assets evolution, 2014-2019F

2. Insurance market
Slide 11: Insurance Markets in CEE – Size vs. growth matrix, 2017-2019
Slide 12: Insurance premiums per capita & premiums/GDP penetration – CEE comparison, 2018
Slide 13: Insurance gross premiums - Local insurers (life/non-life, in EUR), 2015-2019F
Slide 14: Insurance gross premiums - Local insurers (life/non-life, in PLN), 2015-2019F
Slide 15: Top 12 insurance groups in Poland by total premium written, 1H 2019
Slide 16: Insurance market concentration and Herfindahl-Hirschman Index (life/non-life), 2017 vs. 1H 2019
Slide 17: Current and upcoming Insurance M&A transactions in Poland, 2019
Slide 18: Own funds for life and non-life insurers, 2015-1H 2019, SCR coverage ratios, 2016-2018
Slide 19: Number of insurance agents by type and number of sales reps (OFWCA), 2016-2018
Slide 20: Insurance – Regulatory institutions, 2019
Slide 21: Private health Insurance – Opportunity for insurers; Premium written, 2016-2019E

3. Non-life insurance
Slide 22: Non-life insurance markets in CEE – Size vs. growth matrix, 2016-2018
Slide 23: Non-life premiums per capita & premiums/GDP penetration – CEE comparison, 2018
Slide 24: Non-life insurance gross and net premium evolution, 2015-2019F
Slide 25: Top 10 non-life insurance players in Poland, 1H 2019
Slide 26: Market shares of top non-life players evolution, 2016-1H 2019
Slide 27: Non-life premium by client segment and insurance class (car insurance vs. other), 1H 2019
Slide 28: Non-life premium by risk class, 2017-1H 2019
Slide 29: Sales channels of non-life insurance, 2017-2018
Slide 30: Non-life insurers results, technical and P&L accounts (waterfall chart), 2018
Slide 31: Non-life insurance - Profitability tree, 2015-1H 2019
Slide 32: Non-life insurance - Claims and expense ratio evolution, 2015-1H 2019
Slide 33: Non-life insurance - Combined ratio and its elements, 2015-1H 2019
Slide 34: Non-life insurance - Acquisition costs evolution, 2017-1H2019, acquisition cost ratios for top non-life insurers, 2018
Slide 35: Network multi-agents: Unilink, Consultia, CUK, Conditor, LGK etc.
Slide 36: Current legislative initiatives affecting insurance business in Poland, 2017/2019
Slide 37: Car insurance - Premium and no. policies evolution, MTPL, Casco, 2015-1H 2019
Slide 38: Car insurance - Top players in MTPL and in Casco, 2017-1H 2019
Slide 39: Car insurance - Combined ratio and its elements, MTPL and in Casco, 2017-1H 2019
Slide 40: Car insurance - Average premium per policy for Casco and TPL, 1Q2014-2Q2019

4. Life insurance
Slide 41: Life insurance markets in CEE – Size vs. growth matrix, 2016-2018
Slide 42: Life premiums per capita & premiums/GDP penetration – CEE comparison, 2018
Slide 43: Life insurance gross and net premiums evolution, 2015-2019E
Slide 44: Top 10 life insurance players in Poland, 1H 2019
Slide 45: Market shares of top life players evolution, 2016-1H 2019
Slide 46: Life premium by insurance class and segment, 1H 2019
Slide 47: Life premium by risk class evolution, 2017-1H 2019
Slide 48: Life insurance technical reserves evolution and structure, 2016-1H 2019
Slide 49: Sales channels of life insurance, 2017-2018
Slide 50: Life insurers results, Technical and P&L accounts (waterfall chart), 2018
Slide 51: Life insurance - profitability tree, 2015-1H 2019
Slide 52: Life insurance - acquisition costs evolution, 2017-1H 2019, acquisition cost ratios for top life insurers, 2018

5. Bancassurance
Slide 53: Bancassurance: Premium written by bank channel (life/non-life), 2016-2018, data by KNF vs. data by PIU
Slide 54: Bancassurance: Product/class split in bank channel (life/non-life), 3Q 2019
Slide 55: Bancassurance: Sales of investment type life products other than unit-linked, 2015-3Q 2019
Slide 56: Bancassurance: Comparison websites and online sales sites of banks – overview, 3Q 2019

6. Top players' profiles
Slide 57: Non-life insurance: PZU TU, 2017-1H 2019
Slide 58: Non-life insurance: Ergo Hestia STU, 2017-1H 2019
Slide 59: Non-life insurance: Warta TUiR, 2017-1H 2019
Slide 60: Life Insurance: PZU Życie, 2017-1H 2019
Slide 61: Life Insurance: Aviva TUnŻ, 2017-1H 2019
Slide 62: Life Insurance: Nationale-Nederlanden TUnŻ, 2017-1H 2019

7. Forecast
Slide 63: Non-life insurance premiums forecast, 2019-2021
Slide 64: Life Insurance premiums forecast, 2019-2021
Slide 65: Notes on Methodology
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Issued By Inteliace
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Business Address Inteliace Research Foksal 17B/31 00-372 Warszawa, POLAND
Country Poland
Categories Insurance
Tags Insurance , Poland , CEE
Last Updated December 30, 2019