Poland's Insurance Sector to Grow in 2017 But Profitability Under Pressure, Inteliace Says in Its New Report
“After overcoming the recent stagnation, total insurance premium in Poland is expected to increase fast at ~7% p.a. through 2019,” said Marcin Mazurek, director of Inteliace Research, during a presentation of Inteliace's latest report, Insurance Market in Poland, 2017-2019.
Recently, two contradictory trends have been shaping the insurance market in Poland. The life insurance segment has remained in a downturn, as it continued to suffer from tighter regulatory environment in multiple areas, including: consumer protection, distribution, fiscal treatment etc. Moreover, an overall negative sentiment around insurance investment products and low interest rate environment have not helped new product sales. By contrast, the non-life segment has seen significant growth in new premium collection. This could be attributed mostly to surging car insurance premium, which has been an effect of both: increasing tariffs and a higher number of contracts.
It is remarkable that even after significant increases in tariffs, TPL insurance is still unprofitable on average, which indicates that further tariff increases are in the pipeline. By contrast, the profitability of life insurers, which has been traditionally quite high, remains in a declining trend. This is driven mainly by lower returns on investments and significantly higher regulatory costs.
Considering the high competition among insurers, continuously growing claim costs, and persisting low returns on investments, resulting from low interest rates, the profitability of insurers will remain under pressure in 2017 and 2018. Most advanced insurers will address the issue of lower profitability with further automation of processes, reduction of operating costs and more sophisticated anti-fraud measures. Also new, innovative solutions will be high on agenda with usage-based insurance, telematics and multi-channel distribution models being a source of competitive advantage.
For more information on recent developments in the Polish insurance sector, please refer to the publication “Insurance Market in Poland, 2017–20179” at:
About The Report
“Insurance Market in Poland, 2017–2019” 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 2019. 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 2005–2017, Inteliace Research provided its products and services to more than 65 clients, including major CEE banks and several “The Banker” top world banks. To learn more about the company, visit Inteliace Research’s webpage: www.inteliace.com.