A week ago we published on beinsured ENG the general PZU financial results in H1 2017 commented by the PZU board members (read more: PZU once again posts record-breaking gross written premium and doubles its profit in H1 2017).
Premiums
In H1 2017 the PZU Group collected gross written premium of PLN 11,6 million, i.e. 17.7% more than in the corresponding period of the previous year. This is the result of sales being up PLN 940 million in the mass client segment, especially motor insurance and being up PLN 413 million in the corporate client segment, chiefly on motor insurance in connection with the higher average premium and the number of insurance policies. The premium in the individual insurance segment also rose by PLN 254 million, driven mainly by higher sales of unit-linked products in the bancassurance channel. The premium in the group and individually continued insurance segment increased by PLN 39 million primarily because of the higher sales of health insurance concluded as group insurance. PZU now has 1.4 million agreements of this type in its portfolio. International companies also posted premium growth of PLN 97 million.
Claims and benefits
In H1 2017 net claims and benefits and the incremental growth in the PZU Group’s provisions totaled PLN 7,2 million, i.e. 17% growth over the corresponding period of last year. The following factors contributed to the movement in net claims and benefits: the growth in motor insurance claims and benefits in the corporate and mass segments, higher level of claims and benefits in insurance for losses caused by calamities and general liability insurance in the corporate segment, higher provisions for individual unit-linked products in the bancassurance channel and, to a lesser extent, the same type of group and individual products offered in its own network (mostly Employee Pension Plans and individual retirement accounts [IKE]). In the last two cases, this resulted from higher client contributions to their accounts and significantly better investment performance in the period under analysis.
The decline in net claims and benefits was caused by the lower level of claims in the group of insurance for other losses to property in the mass client segment, mostly for subsidized crop insurance – in the corresponding period of 2016 the forces of nature caused many losses.
Administrative expenses
The Group’s administrative expenses in H1 2017 were PLN 2 million compared to PLN 1,3 million in H1 2016, i.e. they were up 59% over the previous year. This increase resulted mainly from the commencement of Pekao’s consolidation and the merger of Alior Bank with BPH’s spun-off operations on 4 November 2016. Administrative expenses in the banking segment rose PLN 700 million. The change resulted from the higher expenses incurred in bancassurance products following a change in the rules of making settlements with banks under bancassurance agreements, offset by lower expenses of project activity.
Profit
In H1 2017 the PZU Group generated an operating result of PLN 2,2 million compared with PLN 1,05 million in the previous year (up 109%). Net profit grew in comparison to H1 2016 by PLN 943 million (+119%) to PLN 1,733 million. Net profit attributable to the parent company’s shareholders was PLN 1,446 million compared to PLN 660 million in 2016 (up 119%).
