Poland: insurers will be able to consider also the driving penalties in each driver's history when underwriting MTPL

16 June 2022 — Daniela GHETU
Starting June 17, Polish motor insurers will have access to information about fines and penalty points acquired by drivers, thus being able to consider driver's behavior as demonstrated by their penalties' history when calculating MTPL tariffs. Access to data will be possible through the tools of the Insurance Guarantee Fund.

It does not mean, however, that automatically each insurance contract concluded from that date will consider this risk factor, an article published on the Polish Chamber of Insurance (PIU) website states. Insurance companies will need time to obtain appropriate access certificates, prepare tariffs, etc. As such, it is difficult to define a specific date from which a given company will introduce a tariff including penalty points and fines.

Getting access to this new set of data will allow insurers an ex ante assessment of the driver's risk, unlike the current situation when the assessment is based only on the accident history of a given driver. "Now, when we get access to fines and penalty points, we will be able to judge before the worst happens," Jan Grzegorz Pradzynski, President of PIU stated in an interview. "It also has a preventive effect: it will allow to differentiate the rates even more, so that people who drive dangerously pay more, and people who drive according to the regulations pay much less," he added.

Pradzynski also emphasized for the Polish press that "despite the growing general inflation, TPL prices in Poland were stable." He explained the loss frequency parameters are worsening now, after the improved values seen throughout the pandemic period due to reduced traffic. "There is what we call loss inflation. This means that the average damage is now much more expensive than before. For now, the market is profitable. However, if insurance prices remain at today's level, and the number of accidents continues to grow, after three years, the motor third-party liability market will be negative by PLN 3 to 4 billion. These are huge amounts and therefore insurers will have to raise their prices. However, it is an individual decision of each insurance company," he added.