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Interactive navigation is a tool that goes beyond the standard navigation of the integrated content (available in the report drop-down bar). New approach allowed to navigate in the two additional business dimensions of the PZU Group, i.e .:
- strategy (insurance, health, investments, finances);
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The above-mentioned areas were additionally supplemented with related GRI indicators, within each selected issue.

PZU Group’s income

Annual Report 2018 > PZU Group’s income
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In 2018, the PZU Group collected gross premiums of PLN 23,470 million or 2.7% more than in 2017.

The PZU Group posted the following results in the various segments:

  • sales in the mass client segment up PLN 296 million (net of intersegment gross written premium) compared to 2017, primarily in motor insurance due to an increase in average premium and a roughly constant number of TPL policies;
  • premium increased in the corporate client segment by PLN 386 million from 2017 (net of intersegment gross written premium), mainly in motor insurance due to the higher average premium coupled with a decline in the number of motor own damage insurance policies and higher sales of insurance against fire and other damage to property following the execution of several contracts with high unit values;
  • higher sales in the group and individually continued insurance segment – premium up PLN 36 million, in particular as a result of writing more premium in health insurance sold in group form;
  • PLN 318 million drop in premiums in the individual insurance segment compared to the year before, driven mainly by lower contributions to accounts in unit-linked products in the bancassurance channel;
  • gross written premium collected by foreign companies also increased compared to 2017 by PLN 222 million, chiefly in motor insurance in the Baltic States.


PZU Group’s income


Insurance segments (PLN millions), local GAAP

Gross written premium (external)
Total non-life insurance – Poland (external gross written premium)13.38412.70210.8789.0748.367
Mass insurance – Poland10.32510.0298.7427.3096.56
Motor TPL4.614.6063.6352.5952.373
Motor own damage2.5242.4062.1471.7271.579
Other products3.1913.0172.962.9872.608
Corporate insurance – Poland3.0592.6732.1361.7651.807
Motor TPL845735532367354
Motor own damage878848712510461
Other products1.3361.09892888992
Total life insurance – Poland8.2378.5197.9497.9237.808
Group and individually continued insurance – Poland6.8916.8556.7756.6896.539
Individual insurance – Poland1.3461.6641.1741.2341.269
Total non-life insurance – Ukraine and Baltic States1.7291.5271.3051.288632
Ukraine non-life insurance202181173138133
Baltic States non-life insurance1.5271.3461.1321.15499
Total life insurance – Ukraine and Baltic States120100887478
Ukraine life insurance5542373141
Baltic States life insurance6558514337

Structure of gross written premium at PZU Group (%)

Net revenues from commissions and fees

Net revenues from commissions and fees in 2018 were PLN 2,620 million, or were PLN 858 million higher than in the previous year, mainly caused by the commencement of Pekao’s consolidation.

They included mainly:

  • net revenues from commissions and fees in the banking segment of PLN 1,925 million, including mainly: brokers’ commissions, revenues and expenses related to the service of bank accounts, payment and credit cards, fees charged for intermediation in insurance sales;
  • income on OFE asset management. It amounted to PLN 122 million (up 1.7% compared to the previous year because of the higher average net assets of OFE PZU);
  • revenues and fees received from funds and mutual fund companies in the amount of PLN 562 million, or PLN 285 million more than in the previous year, mainly caused by the start of Bank Pekao’ consolidation. 

Net investment result and interest expenses

In 2018, the net investment result2 including interest expenses was PLN 8,584 million compared to PLN 7,121 million in 2017. This higher result was caused predominantly by the commencement of Pekao’s consolidation in June 2017. After the contribution of Pekao and Alior Bank is netted out, the net investment result after factoring in interest expenses in 2018 was PLN 904 million and was PLN 951 million lower than in the previous year.

The following factors affected the income:

  • softer performance on listed equities, driven in particular by the deterioration of market conditions on the WSE – the WIG index fell by 9.5% in 2018 compared to a 23.2% growth in the corresponding period of the previous year;
  • better performance of the marked to market treasury bonds portfolio, in connection with the more favorable situation on the debt market;
  • negative impact exerted by the foreign exchange differences on own debt securities in conjunction with depreciation of the PLN versus EUR following appreciation in the comparable period, partially offset by the better performance of investments denominated in EUR .

In addition, the results on the portfolio of assets covering investment products were down PLN 528 million y/y, even though this is neutral to the PZU Group’s overall net result because they are offset by the lower level of net insurance claims and benefits. 

In 2018, the value of the PZU Group’s investment portfolio3, excluding the impact of banking activity, was PLN 50,270 million compared to PLN 46,164 million as at the end of 2017.

The overall growth of the investment portfolio was related to the higher premiums inflow due to business growth and the rising value of the investments.

The increase in the balance of reverse repo transactions and term deposits with credit institutions entered into on the interbank market aimed to enhance the return on investment activity. The increase in the balance of these transactions was partly offset by the decrease in the balance of funds presented in receivables presented outside the investment portfolio.

The Group runs its investment operations in compliance with statutory requirements while maintaining appropriate levels of safety, liquidity and profitability, therefore debt treasury securities accounted for over 60% of the investment portfolio.

Structure of the investment portfolio net of the impact of banking activity* (in %)

* Interest rate, foreign exchange and equity price derivatives duly presented in the categories of debt market instruments – treasuries, money market instruments and listed and unlisted equity instruments.

Result on other operating income and expenses

In 2018, the balance of other operating income and expenses was negative and stood at PLN 2,165 million, compared to the balance in 2017, which was also negative at a level of PLN 1,580 million. The following contributed to this result:

  • levy on financial institutions – the PZU Group’s expense on account of this levy (combined on insurance and banking activity) in 2018 was PLN 1,092 million compared to PLN 822 million last year. The increase in the liability was caused by the commencement of Pekao’s consolidation in June 2017;
  • costs of amortization of intangible assets identified as a result of acquiring companies were up PLN 53 million (effect of the acquisition of the equity stake in Pekao in June 2017);
  • increase in the BFG charges from PLN 121 million in 2017 to PLN 372 million in 2018 (as a result of the acquisition of the equity stake in Pekao).


2 Net investment result includes: net investment income, net result on realization of financial instruments and investments, movement in allowances for expected credit losses and impairment losses on financial instruments and net movement in fair value of assets and liabilities measured at fair value.
3 The investment portfolio contains investment financial assets (including investment products), investment properties (including the part presented in the category of assets held for sale) financial derivatives along with the negative valuation of derivatives and liabilities arising from repurchase transactions presented in financial liabilities.

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