STATISTICS: POLAND, 1H2021: increased mortality caused by the pandemic affected technical result on life insurance

23 September 2021 — Daniela GHETU
STATISTICS:  POLAND, 1H2021: increased mortality caused by the pandemic affected technical result on life insurance
After the challenging year 2020, when Polish insurers' business decreased by about 8.3% y-o-y, the first half of 2021 showed signs of recovery that resulted in a positive dynamic, GWP growing by 8% y-o-y, to EUR 7.6 billion, data provided by the Polish Chamber of Insurance (PIU) show.

On the claims side, insurers paid out EUR 4.4 billion in claims and benefits to the injured. Life protection insurance payments increased the most, mostly as a result of the increased mortality caused by the pandemic. Payments from protection insurance went up by 34%. The Motor Hull insurance line was the second largest increasing claims generating business line.

"The first half of 2021 in insurance shows the tragic effects of the pandemic. Life insurance benefits reached almost EUR 875 million, compared to EUR 660 million a year earlier," said Jan Grzegorz Pradzynski, president of the PIU management board.
The good news is that the premium in life insurance also increased, indicating a stronger interest in these products. In total, the premium from life insurance amounted to EUR 2.44 billion, up by 7.6% y-o-y. The premium for life protection insurance alone increased by 12.4%, to EUR979.6 million.

On the non-life insurance side, motor insurance and property insurance classes have provided for the largest GWP growth in absolute terms, but on the claims side motor insurance, especially Motor Hull, have also provided for the largest increase in benefits paid.

The average premium for the compulsory MTPL insurance in the first half of 2021 was PLN 488, less by 1.2% y-o-y. At the same time, the average loss increased to PLN 8337, which is 8.1% more than a year ago. "Too much decline in rates with a simultaneous increase in the average loss is not beneficial for the industry and customers. We dealt with a similar phenomenon a few years ago, which resulted in significant price increases, arousing public opposition," Pradzynski commented.

The first half of 2021 saw no major losses in terms of weather damage. Compensation related to natural disasters and other material damages amounted to EUR 285.46 million, which is about 11% less y-o-y. "The results after the first half of this year do not change the fact that we will face violent weather phenomena more and more often. We are not able to avoid them, but we can protect ourselves against them financially thanks to insurance," - says Andrzej Maciazek, vice president of the management board of PIU. In this context, the 13% increase in GWP seen in H1, to EUR 950.5 million is a good sign of awareness regarding the need of protection.

At the end of June 2021, insurers paid PLN 665 million of income tax to the state budget. During that time, they generated about EUR 597 million of net profit, i.e. by approx. 30% less than a year ago, mainly as the result of a lower technical result in life insurance.

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[s|Poland, statistics]