In 2024, the issuer (PZU) recorded a technical result of PLN 1,069 million, compared to PLN 1,455 million in 2023, a drop by 26.5% (-386 million y/y). Net profit was PLN 3,877 million, down 2.7% relative to PLN 3,983 million generated in the previous year. Disregarding the dividends received from PZU Życie, PZU’s net profit was PLN 2,195 million, and was by PLN 809 million, i.e. 28.9 %, lower compared to 2023.
- increase in gross written premium to PLN 17,757 million, or 9.7% more than in the previous year. The increase results from higher sales in motor insurance, both MTPL and MOD (mainly due to rising average premiums following changes caused by increased claims), higher premiums from insurance against fire and other damage (mainly due to increased sales of housing insurance, PZU Firma and underground property insurance) and general liability insurance, as well as assistance insurance. After the reinsurers’ share and change in the provision for unearned premiums, net earned premium was PLN 15,119 million and was 9.2% higher than in 2023;
- higher level of claims and benefits – amounting to PLN 9,843 million, which means an increase by PLN 1,466 million, i.e., 17.5% compared to 2023. Higher claims observed in most insurance groups, with the highest in the motor insurance group (both MTPL and MOD), as well as insurance against fire and other damage, insurance guarantees and assistance benefits;
- an increase in net income from investing activities¹ to PLN 3,760 million (up 4.3% y/y) following higher dividends from PZU Życie and an increase in net income from debt securities as a result of the purchase of Polish government bonds for the portfolio at high market yields; the impact of the above factors was partially offset by lower performance of subordinated companies, particularly in the banking business, as well as a lower net income from the sale of shares from the non-standard investment portfolio, with valuation of these shares until realization being recognized through a change in revaluation reserve;
- acquisition expenses higher by PLN 179 million, or 5.7%, compared to 2023, including reinsurance commissions, as a consequence of the growing insurance portfolio and the high share of multiagency and broker channels in the sales structure, characterized by higher commission rates;
- a 7.4% increase in administrative expenses, from PLN 906 million in 2023 to PLN 973 million in 2024. Increase mainly as a consequence of higher personnel costs (impact of employee salary increases due to changes in the macroeconomic environment), IT costs due to the development in the IT area and building competence in the area of maintaining systems and rental services. The effect partially offset by lower levels of marketing spending, including advertising and sponsorships.
1. investing activities include investment income, unrealized gains on investments, costs of investing activities, unrealized losses on investments and share in net profit (loss) of subsidiaries measured by equity method.
- the MOD insurance premium with a 25.7% share of PZU’s total gross written premium down -0.2 p.p. compared to the previous year). The premium value largely increased in comparison to 2023 (by 8.8% y/y), which is due to the high growth in the number of insurance contracts, with the simultaneous increase in average premiums (rising vehicle values translating into an increase in sums insured);
- premiums on insurance against fire and property damage accounting for 25.0% of PZU’s premium portfolio. Compared to 2023, their share in the insurance portfolio increased by 0.6 p.p., while their value was up 12.7%. The increase in premiums was driven by higher sales of housing insurance, PZU Firma and underground property insurance, among other factors;
- premiums from other liability insurance accounting for 6.8% of the PZU’s insurance portfolio. The premiums were 14.4% higher y/y and their share in the portfolio increased by 0.2 percentage points. This resulted from the growth of the TPL portfolio offered with PZU Firma and PZU DOM, as well as TPL insurance for company authorities;
- other insurance premiums, which accounted for 12.5% of the portfolio, up 0.4 p.p. compared to 2023. The increase in premiums is the result of higher sales of illness insurance offered in cooperation with the Group’s ban s, and higher sales of assistance insurance (mainly PZU Auto Pomoc and PZU Auto Szyba, as well as travel insurance), offset by lower sales of ALOP loss-of-profit insurance and shipyard insurance.
For growth in 2024 net result on investing activities was mainly contributed by higher dividends from PZU Życie and an increase in net income from debt securities as a result of the purchase of Polish government bonds for the portfolio at high market yields;
the impact of the above factors was partially offset by lower performance of subordinated companies, particularly in the banking business, as well as a lower net income from the sale of shares from the non-standard investment portfolio, with valuation of these shares until realization being recognized through a change in revaluation reserve.
In 2024, net claims and benefits, with the change in PZU’s provisions, totaled PLN ,843 million, i.e. 17.5% more than in 2023. The most significant factors that contributed to the change in the net value of claims and benefits were as follows:
- a significant increase in the value of claims and benefits in the group of motor insurance (both TPL and MOD insurance). The movement in claims and benefits was caused by deterioration in the claims ratio in the current year (the impact of an increase in average claims paid and in frequency of events) and decrease in reserves for prior year losses;
- a higher level of claims in insurance against fire and other damage, mainly as a result of the huge occurrence of mass damage caused by forces of nature (heavy rainfall, inundation and flooding) with a net impact of -255 million on the technical result, as well as higher claims in the agricultural insurance portfolio – mainly with regard to subsidized compulsory agricultural crops as a result of frost and hail in 2Q2024;
- an increase in the value of claims and benefits in the group of ADD and other insurance, mainly as a result of the deterioration in the claims ratio of the PZU Auto Pomoc and PZU Auto Szyba portfolio (the impact of higher claims frequency y/y);
- a slight decrease in the value of claims and benefits in the general third party liability insurance group, as an outcome of a decline in compulsory agricultural liability insurance, professional liability insurance and liability insurance under PZU Firma, as well as an increase in claims ratio in medical and general liability insurances;
Acquisition expenses (including reinsurance commissions) amounted to PLN 3,337 million in 2024, increasing by 5.7% in comparison to 2023, which along with an 9.2% increase in net earned premium y/y translated into improvement of the acquisition expense ratio by 0.7 p.p. The dynamics of the acquisition expense ratio was driven by the modification in the product mix, among other factors.
In 2024, administrative expenses reached PLN 973 million, i.e. 7.4% higher than in the previous year, which alongside the increase in net earned premium by 9.2% y/y translates into a worse administrative expense ratio, by 0.1 p.p. The increase in administrative expenses is mainly a consequence of higher personnel costs (impact of employee salary increases due to changes in the macroeconomic environment), IT costs due to the IT area development and costs of building competence in system maintenance, as well as real estate costs (including rental services). The effect was partially offset by lower levels of marketing spending, including advertising and sponsorships.
At the end of 2024, PZU’s balance sheet total was PLN 56,094 million and was 5.9% higher compared to the previous year.
The main component of PZU’s assets were investments which stood at PLN 49,240 million (up 5.6% compared to the end of 2023), which accounted for 87.8% of PZU’s total balance sheet value, compared to 88.0% as at the end of the previous year. The level of deposits, excluding deposits in subsidiaries, increased due to the achieved investment performance and the net inflow of funds from operations, partially offset by the payment of dividends.
As at the end of 2024, PZU’s receivables stood at PLN 3,124 million, and accounted for 5.6% of assets, whereas the year before they amounted to PLN 2,954 million (5.6% of assets). The increase is an outcome of higher direct insurance receivables (PLN +95 million y/y net of impairment charges) and an increase in other receivables (PLN +109 million; the impact of higher receivables from unsettled placement transactions and security deposits, from retained guarantee deposits, as well as receivables for acting as an emergency adjuster and from settlements within the Tax Group).
Fixed assets, in the form of intangible assets, goodwill and property, plant and equipment were disclosed in the balance sheet at PLN 460 million (PLN +13 million y/y). They accounted for 0.8% of assets (similar to the previous year).
As at the end of 2024, PZU held cash of PLN 194 million (0.3% of assets). The year before, the corresponding value was PLN 160 million.
| Basic performance indicators of PZU | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
|
Return on equity (ROE) (annualized net profit / average equity) x 100% |
11.8% | 12.1% | 10.4% | 21.7% | 17.8% |
|
Return on assets (ROA) (annualized net profit / average assets) x 100% |
4.4% | 4.6% | 3.6% | 8.1% | 7.1% |
At the end of 2024, technical provisions were the main component of PZU’s equity and liabilities. They reached the value of PLN 26,392 million (net), which accounted for 47.0% of equity and liabilities. Their share of the balance sheet fell by 0.5 p.p. compared to 2023, while in value terms they increased by PLN 1,245 million, due in particular to:
- a higher level of premium reserves, mainly in motor insurance and insurance against fire and other damage to property, as well as in the group of ADD and other insurance;
- higher provisions for unpaid claims and benefits, mainly in the group of MTPL insurance, general TPL insurance, insurance against fire and other damage to property, and in the group of ADD and other insurance.
As at the end of 2024, shareholders’ equity was PLN 22,729 million and accounted for 40.5% of equity and liabilities, up 1.1 p.p. compared to the end of 2023.
Contingent receivables amounted to PLN 4,000 million, i.e. increased by PLN 924 million (+30.1%) in comparison to the previous year. These comprised of, among other things, guarantees and sureties received and other contingent receivables comprising mainly collateral received in the form of mortgages on the debtor’s assets and other contingent receivables.
The balance of contingent liabilities was PLN 1,477 million, which represents a decline by PLN 578 million (28.1% y/y) in comparison to 2023. This is mainly the result of a decrease in disputed claims, not recognized by the insurer referred by creditors to litigation (PLN – 483 million y/y) and lower other contingent liabilities due to undisbursed loan tranches (PLN -97 million y/y).
In 2024, PZU generated a return on equity (ROE) of 17.8%, down 3.9 p.p. compared to 2023. In 2020–2024, the average return on equity (ROE) was 14.7%.
| Operational efficiency ratios | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
|
Gross claims and benefits ratio (simple) (gross claims and benefits / gross written premium) x 100% |
63.2% | 57.2% | 62.6% | 59.3% | 61.4% |
|
Claims and benefits ratio (net claims and benefits / net earned premium) x 100% |
62.4% | 61.7% | 61.9% | 60.5% | 65.1% |
|
Insurance activity expense ratio (insurance business expense / net earned premium) x 100% |
26.1% | 27.3% | 28.0% | 29.4% | 28.5% |
|
Acquisition expense ratio* (acquisition expenses / net earned premium) x 100% |
20.1% | 21.3% | 22.1% | 22.8% | 22.1% |
|
Administrative expense ratio (administrative expenses / net earned premium) x 100% |
6.0% | 6.1% | 5.9% | 6.5% | 6.4% |
|
Combined ratio in non-life and other personal insurance (net claims and benefits + insurance business expenses / net earned premium) x 100% |
88.5% | 89.1% | 89.9% | 89.9% | 93.6% |