PIU has worked out the catalogue of road events

PIU, in co-operation with Polski Związek Motorowy Holding SA, has worked out the catalogue of 190 most frequent situations of road accidents. A precise description has been attached to each example, explaining which of the participants is responsible for the event to happen. The catalogue will make the waiting time for indemnity to be shorter and it will be easier for insurers to settle between one another.
„Catalogue of Road Events” not only defines the driver’s liability for causing a collision, but it also defines the extent to which different collision participant contributed to the event, when the fault is not only on one side, which is often the case. In such situations, it is the most difficult and longest procedure to define the liability for the collision. – Due to „the Catalogue” it will take much shorter for the insurer to determine the liability in such situations – says Katarzyna Lewandowska, Chairwoman of PIU Motor Insurance Committee.
„The Catalogue” will be applied above all in such cases where the circumstances have not been documented properly, e.g. the police was not called to the place of the event or there are no witnesses of the event.
Certainly, the Catalogue does not contain all possible events which can be faced by the driver on the road; however the situations described therein belong to those which are encountered most frequently. The Catalogue will be updated and extended according to clients’ expectations and insurers’ needs.
The Catalogue also means the possibility to simplify mutual settlement of accounts among insurers within the framework of recourse agreement worked out by PIU several months ago. It is also an important step towards the building of a new direct loss adjustment system in Poland.
The catalogue has been assessed positively by the Institute of Forensic Research in Cracow.

The persons who insured their cars, houses and other property, received above 12 billion PLN from insurers in the form of indemnities in 2009, as results from the data gathered by PIU. The benefits from life insurance reached approx. 28 billion PLN. It also results from the data on sale structure that insurance agent’s services are most popular among the clients who are looking for a property insurance product.
The value of indemnities and benefits paid in 2009 was the highest in the whole history of Polish insurance market in respect of both life and non-life business. As far as life insurance is concerned, the value of benefits grew by as much as 43 per cent which was related to the expiry of short-term investment wrapped in policies. Most indemnities on the non-life market were related to, like every year, motor insurance.
Insurers paid above 5 billion PLN (a growth by 18 per cent) from MTPL policies. It was 3.7 billion PLN from autocasco policies (a growth by 20.7 per cent). At the same time, we faced a drop of value of the premiums collected by insurers. Insurers collected 30.3 billion PLN for life policies which means a drop by above 22 per cent on year-to-year basis. This drop is the result of withdrawal of many insurers from offering investment policies distributed through the banks. Non-life insurers increased slightly their gross premium written in 2009, up to 21 billion PLN (3.6 per cent more than the year before).
In total, gross premium written dropped by above 13 per cent in 2009 on the whole insurance market. The growth of payments of benefits and indemnities with a simultaneous drop of premium was decisive for insurers’ financial results. It can be illustrated by the example of non-life insurers. Growth of the value of indemnities by one fourth (with a growth of premium by as little as 3.8 per cent) was the reason of the technical loss amounting to 222 million PLN and reported by the non-life market by the end of 2009. Non-life insurers’ net profit dropped from 3.33 billion PLN down to 2.68 billion PLN.
Life insurers reported better financial results than a year before, in spite of the growth of benefits paid and a drop of premium. It was caused, to a large extent, by higher revenues from investment. Life insurers increased them by above 46 per cent. In total, life insurers earned 4 billion PLN in 2009 which is 59 per cent more than a year before.

SALE OF INSURANCE IN POLAND IN 2010
Insurance agent is the most popular distribution channel if we want to insure our flat or car. In case of life market, the leading intermediaries are banks and insurers’ employees.

Non-life market

– agents
Insurance agents (natural persons) generated nearly 44 per cent of the premium collected in 2009. It is approx. 2 per cent more than a year before.

– direct (by phone and online)
The value of insurance products sold online increased by 55 per cent in 2009. The sale by phone increased by 42 per cent. It should be noted that the PIU data do not cover the insurers operating in Poland in the form of branch offices. Taking those companies into account, the value of direct market after 2009 would be 677 million PLN. Without taking those companies into account, the value of direct market amounts to 450 million PLN.

– brokers
The share of brokers in non-life insurance sale structure increased in 2009. Presently, they generate 15.6 per cent of all premiums. It was 14.3 per cent last year.

Life market

Despite insurers’ withdrawal from bank assurance, the banks remain the leading distributor of individual policies (28 per cent market share). However, the situation has changed in respect of group insurance. In this area the banks have lost their leadership and been replaced with insurers’ employees. The share of banks in the distribution of group insurance dropped from 52 per cent down to 32 per cent. The share of insurers’ employees increased from 28.5 per cent up to 37.3 per cent. The share of insurance agents in the sale of individual policies is also large and amounts to 23.9 per cent. The share of brokers and direct sales is still of the marginal meaning in the area of life insurance.

Another lecture of insurance expert given at the Faculty of Economic Sciences of the University of Warsaw (WNE UW) is now behind us. This lecture was a part of Knowledge Sharing Programme, organized by PIU in cooperation with WNE UW.
Mr Marek Izraelski, Director of Transport and Personal Insurance at HDI Asekuracja TU SA, presented a lecture entitled “Transport insurance as a risk management instrument for an enterprise”.
It was the fourth lecture within Knowledge Sharing Programme, targeted at students and academics. The Programme comprises of two elements, i.e. lectures given by insurance market experts and interships in PIU for students of WNE UW. We are pleased to inform that the first student started her internship this week.
Using this occasion we would like to invite all students, academics and people interested in topics related to the insurance market, to take part in the next lecture, which will take place on April 13. The lecture will be given by Mr Witold Jaworski, member of the PZU SA board and adjunct at Department of Insurance of Poznan University of Economics.

Within the framework of the national educational campaign, PIU has launched a co-operation with the leading domestic guide-type monthly called „Olivia”.
Co-operation wit „Olivia” covers a series of articles devoted to different types of insurance products. They are to enable the readers to get familiar with insurers’ offer.
The issue of explaining any doubts which appear when concluding an insurance agreement and when paying an indemnity or benefit, has been emphasized.
The first article which has been prepared in co-operation with PIU will be devoted to life insurance products. It will appear on the market on 10 March of this year. Last year, PIU co-operated within a similar educational campaign with another leading guide-type magazine called “Pani Domu”.
Insurance-related education constitutes one of statutory goals of the Association. Co-operation with guide-type media is aimed at reaching the insurers’ potential clients whose knowledge about insurance law and the products available on the Polish market is not sufficient.

After the recommendation of the Parliamentary Infrastructure Committee concerning the trailers to be left in the catalogue of automotive vehicles, and following the amendments of the Senate to the amended road transport law, the Seym has adopted the Senate’s amendments at the voting. Thus, the postulates of the Polish Insurance Association have been taken into account to adopt the regulations in view of which the trailers will still be covered by the mandatory MTPL insurance. PIU opted for such a solution during the works of both Seym Infrastructure Committee and Senate Committee of National Economy. 2 deputies only voted against the Senate’s amendment with 404 deputies against the amendment rejection, and 1 deputy abstained. Now, the act will be transmitted to be signed by the President. At the stage of legislative works, PIU indicated the threats resulting out of excluding trailers from the compulsory MTPL insurance, not only those connected with the injureds’ protection, but also those related to the fact that such a solution would be in contradiction to the EU-law, according to which the word „vehicle” means any motor vehicle (…) any trailers, coupled or not”.

General Meeting of the Polish Insurance Association has appointed Mr Witold Walkowiak the PIU Board Vice-President. 
Witold Walkowiak has chaired the PIU Economics and Finance Committee since the beginning of 2009. The first period of his professional career, i.e. the period from 1980 to 1991, was related to research work at the Institute of Finance.
Then, he started his work for Bank Handlowy, where he held managerial posts in finance department in the period from 1992 to 2000; he was the vice-president of the bank in the period 2001-2003. In he period 2000-2001 he served as a vice-president of BPH Bank.
His further career was related to the insurance sector: in the period 2003-2006 he served as a board member of PZU SA where he was responsible for the departments of finance, administration and logistics. In the period 2006-2008 he was the financial director of the European Department at Eureko B.V and also served as a member of the council of directors and the chairman of audit committee at insurance companies Friends First (Ireland) and Interamerican (Greece).

Witold Walkowiak is aged 52. He is a graduate of SGH and holds a doctor’s degree in economic sciences.

Presently, the board of PIU comprises of the following persons: Jan Grzegorz Prądzyński – Board President, Witold Walkowiak – Board Vice-President, Andrzej Maciążek – Board Member.

Jan Grzegorz Prądzyński, the President of the Polish Insurance Association, sent a reply to the letter of the Insurance Ombudsman. The Polish Insurance Association decided to one more time bring up the issue of articles concerning the subject of the direct insurance.
The first letter of the Association on the doubts about the articles concerning the direct insurance was interpreted – to the surprise of the Association – as an assault on the institution of the Insurance Ombudsman or even Mrs. Ombudsman herself. Since we respect the institution of the Ombudsman and all the work performed by the employees of this institution, we decided to once again bring up this issue. We wish to explain, with the help of the attached letter, why we discuss the articles about the direct market and why we discuss it publicly.

A reply to the letter of the Insurance Ombudsman

Jan Grzegorz Prądzyński, the President of the Polish Insurance Association, sent a letter to Mrs. Halina Olendzka, the Insurance Ombudsman.
The letter is connected with the recent articles which were published and whose author is Mrs. Małgorzata Więcko, who represents the Bureau of the Insurance Ombudsman. In the opinion of the association, these articles are not only unreliable, but they often contain false information – concerning not only the insurance market, but also the regulations of law. The author (lawyer by education) tries to discredit, with the use of her articles, one of the models of insurance activity – the direct model.

She suggests, among other things, that the direct insurers operate under other legal regulations than traditional insurance companies – which is, of course, not true.

She gives false information on the access of clients of the direct companies to the information about products, general conditions of insurance and possibility to consult the customer service departments. The author, by publishing false information, does not mention either the scale of the alleged problem or does not provide any examples of her discoveries. It is ever so worrying, because it is the Insurance Ombudsman which is appointed by law to represent and protect the business of the clients of insurers.

The publications of Mrs. Małgorzata Więcko not only mislead the clients, but can even result in serious fears of the clients about the reliability of the protection provided by the insurer.

It is through such texts that the institution of the Insurance Ombudsman, instead of creating an insurance awareness in Poland, intentionally creates insurance illiteracy.

In the opinion of the Polish Insurance Association, all the information provided by the Insurance Ombudsman should be provided with special care and accuracy, whereas the said publications lack these two features.

A letter of the President of the Polish Insurance Association to the Insurance Ombudsman

The first meeting of the Emergency Subcommittee examining the draft bill on the change of the Act on the road transport and on change of other Acts (form No. 2401) took place on 23rd October of this year.

The participants of the meeting accepted the argumentation of the Polish Insurance Association and the Ministry of Finance concerning the non-compliance of the proposed, by the members of parliament, definition of a motor vehicle with the consolidated Directive (2009/103/EC). The representatives of the Ministry of Finance, Ministry of Infrastructure, the Association, Insurance Guarantee Fund, the Insurance Ombudsman and the association and associations of carriers participated in the discussion during the meeting.

The Chairman of the Subcommittee suggested a meeting with all the interested parties to draw up a common statutory entry. The grounds for further discussion would be the proposition of the Ministry of Finance which stated that when a vehicle has been removed from the participation in the traffic, the proprietor would be supposed to pay a lower fee on account of the compulsory third-party insurance.

We would like to remind that the draft bill implements changes, among others, to the Act on the compulsory insurance, Insurance Guarantee Fund and Polish Motor Insurers’ Bureau within the scope of the compulsory third-party insurance. The change is supposed to consist in the termination of the third-party insurance agreement when a vehicle has temporarily been removed from the participation in the traffic and in the implementation of a new definition of a motor vehicle (stating that trailers are not motor vehicles). The result would be the exemption of the proprietors of trailers from the obligation to conclude a third-party insurance agreement.

The next meeting is scheduled to take place at the beginning of November of this year.

The Polish Insurance Association presented the Finance Minister with the proposal to change the regulations concerning the regress of the State Treasury for the damage done to the police officers.

The Committee of the Transport Insurance of the Polish Insurance Association prepared, together with the Insurance Ombudsman, the proposal to change the regulations concerning the possibility to demand, by the State Treasury, the return of the paid compensation for the damage done to the police officers.

In the eyes of law, it is doubtful whether the State Treasury which paid the compensation to a police officer, can demand from the remaining entities which are obliged in solidum to return the compensation and especially whether the State Treasury can demand the return of the compensation from the insurer of the perpetrator of the accident. For that reason, a proposal with appropriate amendments in the regulations was prepared.

The draft assumes that the State Treasury is not entitled, on account of the payment of the compensation, to make claims against a third person responsible for the damage to return the paid benefits, because these benefits serve mostly as a social security which the State Treasury is obliged to pay under the Act.

The exception to this rule is the situation where the perpetrator of the accident did damage intentionally or while being under the influence of alcohol (or other intoxicants, psychotropic drugs or substitutes within the meaning of the regulations of the counteracting of drug addiction) or fled the scene of the accident. The foregoing circumstances deserve to be socially disapproved of and their perpetrators should suffer the consequences of their actions.

The draft was conveyed to the Finance Ministry to be taken into account during the work of the Work Group for the Examination of the Regulations of Insurance of the Council for the Development of the Financial Market.