POLAND: MTPL insurers may be soon forced to raise MTPL tariffs

1 December 2022 — Daniela GHETU
Polish insurance companies may be forced to increase MTPL rates for the first time since 2017, given the constant increase in the claims expenses, Gazeta Ubezpieczeniowa wrote, quoting Rankomat, a local comparison website. In Q2 2022, the average value of motor vehicle damage reached PLN 8,769.5, 5.2% up y-o-y.

In addition, on November 1, 2022, new recommendations of the Polish Financial Supervision Authority regarding the settlement of motor vehicle claims entered into force. The enforcement of the new regulation may lead to a 19-27% increase in the motor claims expenses, market analysts have forecasted.

According to the data of the comparison website, in 2015 the average value of the MTPL premium was PLN 434. It increased in 2016-2017 to PLN 779, but as a result of the war price the following years tariffs went down again, especially in the two last years. At the same time, the average value of motor damage was constantly increasing, a trend that seems to accelerate lately.

Besides inflation, the recommendations of the Polish Financial Supervision Authority regarding the settlement of claims under motor insurance, that entered into force on November 1, 2022, may prove a strong driver for the claims expenses' increase. "The KNF justifies the introduction of the new recommendations by, among others, ending the policy of lowering the prices of TPL by some insurance companies in order to attract customers, which reduces the quality of claims handling. In turn, representatives of the Polish Chamber of Insurance argue that the new rules will also contribute to raising rates by garages and towing companies. Therefore, a significant increase in the prices of third party liability insurance in 2023 seems inevitable," explained Kamil Sztandera, Rankomat motor insurance expert.