From 15 to 17 February 2013, the Third Polish Insurance Championship in Sporting Bridge will be held at the Orle Gniazdo Hotel in Szczyrk. For the third time, the Polish Insurance Association has become the patron of the event. Participation requirements, agenda and payment details are available on the website of the Polish Bridge Union:
http://www.pzbs.pl/zapowiedzi/1660-beksidzki-szlem

All interested individuals are invited!

On 7–8 May 2013, the Insurance Sector Congress entitled:

“Common Europe — challenges and perspectives of the insurance market development”

will be held for the first time in Poland, in the Sheraton Hotel in Sopot.

The event is the largest and most important forum for exchange of opinions and experiences in the insurance sector. The Polish Insurance Association, the congress organiser, wishes to initiate a discussion in which Polish and foreign representatives of politics and finance will participate and which will cover the most important social issues:

• Consumer protection, its costs and limitations
• Modern and effective pension system
• Personal damages — solutions and European trends

The PIU website will soon contain a detailed agenda of the Congress. However, you are kindly requested to already save the date in your calendars. Please feel invited to participate in this event of high significance for the insurance sector.

No tendencies for systematic saving for retirement pension as well as very low knowledge of the IKZE (Individual Pension Insurance Account) mechanism are the main reason of the low interest in this programme, as reveal the results of research by Millward Brown ordered by Komitet Obywatelskiej Inicjatywy Ustawodawczej RAZEM (the Commitee of the Legislative Initiative of Citizens RAZEM and the Polish Insurance Association). According to the respondents, introduction of the changes in IKZE suggested by RAZEM and PIU may increase interest in these products by about 8 percentage points.

At the end of the second quarter of 2012 the means were paid into only approx. 12 thousand IKZE accounts while the number of the set up accounts amounted to over 300 thousand. The research of Millward Brown indicates that only 10 percent of Poles save for their pension systematically. This data is very alarming because in the capital pension system the average rate of the salary replacement will amount only to approx. 30 per cent for women and 40 percent for men.
‘Poles should start to realize how important it is to start saving additional money for their pension so that its amount was satisfactory. Unfortunately, the current labor market situation discourages from using the 3rd pillar. On the other hand, as shown by the Millward Brown research, the current products do not fully meet the future pensioners’ needs. Similar situation applied to the IKZE implemented last year which did not raise much interest,’ said Jan Grzegorz Prądzyński CEO of PIU.

The research reveals that only 2 percent of those who save additionally for the future pension use IKZE (0.2 percent in the population). What is interesting, the objective of IKZE was just to encourage to the more common saving. The private insurance connected with 3rd pillar still remains the most popular form, used by 59 percent of persons actively saving for their old age. ‘This proves the huge social importance of insurance of saving and investment character. It shows that the majority of people who want to save in the long term choose this model in particular. It is therefore crucial that the conditions are created for further stable development of this segment of the market in Poland,’ said Jan Grzegorz Prądzyński.
Limited popularity of IKZE may result from the fact that Poles do not know much about it – only 11 percent of the respondents think that they know how these products work. However, even after being presented with the methods of IKZE operations, only 21 percent of the respondents would consider systematic saving for their future pension using this system. Interestingly, the group increases up to 29 percent when the products included the changes suggested by the “Razem” Committee and PIU regarding income tax exemption on the means paid out upon reaching the retirement age and indicating the maximum allowed sum saved in IKZE as an amount of e.g. PLN 4,000 and not in percent, as it is done now. Moreover, the respondents who would consider saving in the current form of the IKZE system, would pay average amount of PLN 115 each month. Upon introducing the suggested changes, this amount would increase up to PLN 123 each month.

It can be said already that IKZE does not fulfill its function and that the involvement in this form of saving for pension is very low. The structure of the products is too complicated and the advantage coming from this is too small for the savers, as for example when reaching the retirement age and upon withdrawal of the resources we would still have to pay the income tax. Therefore, let’s use the good patterns coming from the European countries. The tax exemption on the withdrawal of the resources upon reaching the retirement age was introduced in Denmark and Spain. The quota limitation and not percentage one has been functioning in the UK, Ireland or Spain,’ explains Adam Sankowski, the RAZEM Committee representative.
The positive opinion on the solutions given by the RAZEM Committee and PIU was well received by the Tax Studies Institute. ‘The tax exemption or the quota limits proposals are the right direction of changes in IKZE. These solutions are socially significant because its beneficiaries shall include most of all the persons with average and lower incomes. The project is drafted in a clear and straightforward way and at the same time it gives actual incentive for saving. Most of all, however, it is a solution which can be possibly accepted by the government,’ said Witold Modzelewski, professor, the CEO of the Tax Studies Institute.

Presentation of the Millward Brown research.

Almost PLN 600 million has been paid so far by the insurers for construction of the CEPiK* system. The amount was financed from the drivers’ premiums, as the legal provisions stipulate compulsory transfer of EUR 1 from each public liability insurance to the CEPiK fund. PIU wants this fee to be suspended by the time of presenting the full functionality plans for CEPiK.

Since 2004 each vehicle owner in Poland has paid an equivalent of EUR 1 annually for construction and development of the CEPiK system. This way the insurers (and in fact the vehicle owners) financed construction of the majority part of the whole system and the majority of costs of its current operation.
The Parliament has just commenced works on amendment to the act on vehicle drivers. Its objective is to postpone the implementation date of some provisions due to the necessity of reconstruction of the whole CEPiK system. According to the justification to the project the system breakdowns, high costs of repairs and necessary updates of the functionality enforce a total reconstruction and postponing the date of CEPiK commissioning in its full capacity to the beginning of 2016.

‘In our opinion the fee related to the public liability insurance should be suspended at least until the time of presenting the CEPiK new architecture and functionality plan by the Ministry of Interior,’ said Jan Grzegorz Prądzyński, CEO of PIU.

A special team dealing with the future shape of CEPiK operates nowadays within the Ministry of Interior.
‘Representatives of PIU are ready for works supporting this team. We have no doubts that our experience related to the transport market will help in faster completion of works on the system which should be advantageous for the drivers,’ Jan Grzegorz Prądzyński said.

Unfortunately, according to the proposed amendment, even after 2016 the insurers still would have no access to the CEPiK register. Such access, which only covers the scope necessary for insurance activity, could allow for significant reduction of costs which could lead to more attractive rates for drivers. This could also lead to improvement of road safety, because:

• it would offer additional instrument (next to the operations of UFG – the insurance guarantee fund) for eliminating the drivers without a valid public liability policy from the roads.
• it would eliminate from the roads all the drivers with their driving licenses suspended or those who use cars without the relevant licence
• it would provide the information on vehicles not having valid technical tests.

PIU is also of the opinion, that the current amount paid for the register related to the public liability policies is too high.
‘The CEPiK fees most often exceed PLN 1. We think that in future, i.e. after the CEPiK improvement plans are presented, the possible mark-up on the public liability policy should be adjusted to this level too,’ Jan Grzegorz Prądzyński explains.

On 4 January 2013 the Polish Insurance Association sent a reply to the Polish Insurance Ombudsman to the report published on 11 December 2012, entitled “Life insurance with the insurance equity fund” A separate letter on the report PIU sent to Jan Vincent-Rostowski, the Minister of Finance, with a copy to Władysław Kosiniak-Kamysz, the Minister of Labour and Social Policy and to Andrzej Jakubiak, the Head of KNF (Polish Financial Supervision Authority).
The correspondence is available below.

The Letter to the Ministry of Finance

The Letter to the Polish Insurance Ombudsman

Approximately 50 persons appeared at the festive gala of awards organised by the Polish Insurance Association regarding the journalist and the student contests. At the beginning of the ceremony Wiesław Godzic, Professor, gave his lecture on the roles of celebrities, journalists and experts in the contemporary culture. After the lecture, Jan Grzegorz Prądzyński, CEO of PIU presented the awards to the winners of both students and journalists contests.

First place in the 2012 Leon Kozicki PIU Competition for the best thesis in the field of insurance was granted to Daniel Gwiazda from Warsaw Agricultural University, for his thesis entitled: “The use of ratio analysis in financial management research of life insurance companies”. Second prize went to Dominik Kęska from the Faculty of Law and Administration at the Warsaw University for the thesis entitled: “Term of protection in voluntary liability insurance”. Third prize was awarded ex aequo to: Patrycja Piechowiak and Martyna Roszak from Poznań University of Economics. The former was awarded for her thesis entitled: “Corporate social responsibility (CSR) based on examples from the insurance industry”, and the latter for the thesis entitled: “The programme of compulsory insurance of residential property against natural disasters in Poland, based on the experience of other countries”.

In the 2012 PIU journalist insurance contest, the journalist of the year title went to Mariusz Gawrychowski for Puls Biznesu. The jurors appreciated the high value of information texts, an in-depth analysis of the market and consistency in dealing with insurance issues. The insurance article/program of the year award was awarded ex aequo to Mateusz Ostrowski for his series of films published at Onet.pl internet portal, for the original presentation of the insurance issues and to Regina Skibińska for her cross-sectional articles on insurance issues published in Rzeczpospolita, characterized by exceptional accuracy and reliability. The début of the year award went to Alina Treptow for her articles published in Puls Biznesu regarding the health insurance issues. Rzeczpospolita was praised as the editorial office of the year for the newspaper’s consequence in presenting educational, economic and legal aspects of the insurance issues.

Below please find the photos from the event.

Eight insurance federations representing the biggest markets in the continent presented their postulates to EIOPA, the European regulatory institution and the European Commission. Apart from PIU, the appeal was signed by the following federations: ABI (Great Britain), ANIA (Italy), Assuralia (Belgium), FFSA (France), UNESPA (Spain), UNSAR (Romania), VVO (Austria).

The postulates of the insurance environment representatives are as follows:

The Appeal was announced during the 4th annual Solvency II conference which took place on 7th December in Paris. The insurance associations’ representatives reminded about the key role of the sector in the EU economy financing. They underlined the very important mission of the insurance companies ensuring security and safety to the EU citizens. The participants in the conference stressed out that the insurance companies of the EU nowadays manage the assets in the amount of EUR 7,700 million which is more than half of the EU gross national product.

Results of the 2012 Leon Kozicki PIU Competition for the best thesis in the field of insurance have been announced.
Sixteen theses from all over Poland were submitted for this year’s competition. The Jury included: Irena Jędrzejczyk, professor, Ph. D. — president of the Jury, Kazimierz Ortyński, professor, Ph. D., Dr Wijciech Nagel, Dr Witold Walkowiak, Marcin Łuczyński and Dr Jan Piątek.
This year, the Jury awarded four prizes:
First prize was awarded to Daniel Gwiazda from Warsaw University of Life Sciences for the best thesis entitled: “The use of ratio analysis in researching financial management of life insurance companies”.
Second prize went to Dominik Kęska from the Faculty of Law and Administration at the Warsaw University for the thesis entitled: “Term of protection in voluntary liability insurance”.
Third prize was awarded ex aequo to Patrycja Piechowiak and Martyna Roszak from Poznań University of economics. The former was awarded for her thesis entitled: “Corporate social responsibility (CSR) on the example of insurance industry” and the latter for “The programme of compulsory insurance of residential property against natural disasters in Poland, based on the experience of other countries”. We would like to thank all participants and congratulate all the winners!

• Every hour claimants of automotive liability insurances receive almost PLN 600,000 in compensation
• On average, every 32 seconds an event takes place in Poland which involves payments on the account of Third Party Insurance
• On average, every hour life insurers pay out over PLN 2.8 million of benefits

According to data collected by PIU, in the first three quarters of 2012 property insurance companies paid out their clients over PLN 10.5 billion PLN in compensation. Life insurance claims amounted to over PLN 18.7 
billion.

Automotive insurance market
In the first three quarters of 2012, insurance companies paid out their clients over PLN 3.9 billion PLN in compensation
for motor vehicle liability insurance and PLN 2.58 billion for accident and theft insurance. A slight increase
in total pay outs (2.38%) of Third Party Insurance claims can be observed while accident and theft insurance compensations are still decreasing
(8.5%). The decrease is not, however, as visible as three months earlier, when it exceeded 10 percent.
Additionally, comparing the first three quarters of 2011 and 2012:
• 1.38% more accident and theft insurance policies were bought;
• 2.68% more Third Party insurance policies were bought;
• Average compensation on the account of Accident and theft insurance amounted to PLN 4.750 compared with PLN 4.559 a year earlier;
• Average compensation on the account of Third Party Insurance amounted to PLN 5.369 compared with PLN 4.928 a year earlier;
• The number of accident and theft insurance claims reached a total of PLN 543,000 compared to PLN 618,000 a year earlier;
• The number of Third Party Insurance claims reached a total of PLN 731,000 compared to PLN 778,000 a year earlier;
– In Third Party Insurances, we are witnessing a constant increase of insurers’ liabilities
despite a noticeable decrease in the number of claims. A year by year comparison especially in the
the long-term perspective, clearly shows increase in the average amount of compensation paid. “The decrease in damage for a change derives from the fact that so far the weather this year has been quite
good”, says Jan Grzegorz Prądzyński, CEO of PIU. After the first three quarters 2012:
PLN 6.58 million in Third Party Insurance premiums were paid in, which is 7% more compared with a year earlier. Accident and theft insurance
premiums amounted to PLN 4.2 billion, which is 0.65% more than the year before.

Property insurance market (without automotive insurances)
Data after the third quarter already includes damage related to recent weather disasters,
above all hail. We must also remember that the data covers damage
in agricultural fields which took place at the beginning of the year. Thus, a very large increase in compensations paid
in group 9. (other damage in properties), which amounted to PLN 1.15 billion PLN that is 47.5% more than the year
earlier.

Life insurance market
Life insurance claims remained decreased insignificantly in comparison to last year
and amounted to PLN 18.7 billion. Majority of payments are related to group I (although they are fewer than a year earlier),
which can be linked to the period of short-term deposit contracts conclusion.
Life insurance claims with insurance capital fund have increased, amounting to PLN 4.8 billion PLN, which is 14.5% more
than the year before. Written premiums of these products have increased on a similar rate. They amounted to PLN 8.9 billion
, which is 16.5% more than after the Q3 in 2011.
Total written premiums for life insurance at the end of the Q3 of 2012 came up to
PLN 27.2 billion, which is over 10% more than last year.

Net financial result
Property insurance companies closed the first three quarters of 2012 with PLN 2.9 billion profit, which is 1.23%
less than last year. Life insurers recorded a profit increase — their
net financial result came up to PLN 2.6 billion, which is over 14% more than last year.

Table of results

Twelve journalists were shortlisted for this year’s competition and 61 articles were submitted. At the request of the Competition Jury, PIU Management decided to award the following people:

– Insurance Journalist of the Year: Mariusz Gawrychowski from Puls Biznesu for an in-depth analysis of the market, the high value of information texts and consistency in dealing with insurance issues.

– Insurance Article/Radio Program of the Year:
Mateusz Ostrowski for a series of films shown on Onet.pl for original approach in the presentation of insurance issues. Mutlimedia materials were created with a sense of humour and stories they contained were told in a simple manner.
Regina Skibińska for cross-sectional articles on insurances published in Rzeczpospolita, characterized by exceptional accuracy and reliability.

– Debut of the Year: Alina Treptow for her articles published in Puls Biznesu. Here, the Jury appreciated the author’s focus on health insurance issues. Currently, this is one of the most important issues for the insurance market in Poland.

– Editorial team of the Year: Rzeczpospolita for the newspaper’s consequence in presenting insurance issues in educational, economic and legal aspects.

Congratulations to all the winners!