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Warta: individual tariffs key to high profitability

Modern tariffs, close cooperation with intermediaries and high quality of loss adjustment processes helped Warta expand its customer base, increase gross written premiums and maintain its high profitability ratios.

  • Warta’s non-life insurance company generated growth in gross premium income of almost 24.3 percent in 2017 and reached the level of PLN 5.12 billion.
  • Attention focused on sales of insurance with regular premiums was converted into increased sales in the life insurance company by 8.4 percent
    up to PLN 805.8 million.
  • In total, both Warta companies collected more than PLN 5.93 billion last year.
  • The amount of distributed compensationand benefits was in excess of PLN 3.93 billion.

“We have spent recent years implementing technological solutions with which we could expand our customer base in 2017 with success, while retaining business profitability at high levels. However, we can see new challenges facing the insurance market in the near future. This is why we are devoting so much attention to developing and launching more innovative solutions related, for instance, to process automation and use of artificial intelligence. Now we are involved in several dozen projects in order to further enhance our company’s effectiveness and the comfort of our customers and insurance intermediaries”, says Jarosław Parkot, President of the Management Board of TUiR “WARTA” S.A. and of TUnŻ “WARTA” S.A.

Non-life insurance

Total gross written premiums in 2017 amounted to PLN 5.12 billion, which was 24.3 percent higher than in 2016. The strong growth in premiums was recorded in all key segments of individual insurance, including motor insurance by 42.3 percent and housing insurance by 20.1 percent. Premium growth was also recorded in SME and agricultural insurance. Overall, individual products collected gross written premiums that were 30.3 percent higher than in 2016 and reached PLN 3.76 billion.

The sales result in the motor segment resulted largely from the innovative on-line tariff system. It is with the new system that Warta customers receive policy prices that are based on several dozen variables and thus better suit their features. The number of variables keeps changing as the company keeps verifying and implementing new factors that affect the assessment of insurance risk.

All the innovations we implement have been carefully analysed by us regarding their contribution to the company’s profitability and usefulness for customers. The most modern tariff system on the Polish market has clearly satisfied the first objective and supports us in maintaining profitability at the highest market levels. With the new solution in loss adjustment, we have consolidated our leading position in terms of customer service quality. I am certain that these are the factors that have contributed to our intermediaries’ great satisfaction with their cooperation with Warta, which is confirmed in its high positions in various numerous rankings and surveys, says Jarosław Parkot.

Warta’s non-life company adjusted over 506 thousand losses in 2017 and paid its customers more than PLN 2.90 billion in compensation and benefits.

In 2017, loss adjustment at Warta was reinforced as a result of launching new innovative solutions to improve customer service quality. New functionalities were added to the Warta Mobile application, which now makes it possible to calculate compensation by customers on their own. When the amount is approved by the customer, cash can be transferred on the same day. The use of the Facebook Messenger application to report losses has proven to be a major advantage for people using mobile devices. Additionally, as a result the entire process of loss adjustment at Warta can be arranged for customers with mobile devices.

We keep improving service quality at Warta. The intention is that the process be extremely customer-friendly. To this end, we have been enhancing our processes and launching modern solutions that will accelerate loss adjustment and make it simple and intuitive. We keep expanding the range of available solutions so that every stage of solving customers’ problems is adapted to their priorities. Examples here include the simplification of the loss reporting forms or use of Facebook and the car-sharing trends which for inhabitants of large cities may prove an interesting alternative to rental of substitute cars, emphasises Jarosław Parkot.

Life insurance

In 2016, Warta’s Management Board decided to modify its approach to sales of life insurance by focusing its attention on products with regular premiums. As a result, in 2017 the life company recorded a growth in sales of such products of more than 14 percent and generated PLN 555.0 million in gross written premiums. However, one-off premium insurance remains a major item in Warta’s portfolio. In 2017, such policies generated PLN 250.9 million in gross written premiums, which was only slightly lower than in 2016. Overall, Warta’s life company collected PLN 805.8 million in gross written premiums.

“The recent regulatory changes in the life insurance market, as well as the growing interest among customers in protective products, affected our plans concerning that segment. After the first full year of pursuing our new strategy, we can see that this change has brought about very positive results. We have also received major support from our large group of agents involved in property insurance. It is due to their know-how, experience and customer base that we were able to effectively reach people who did not previously have any life insurance. We will continue the trend in the near future in order to maintain sales dynamics at a similar level, says Warta’s President of the Management Board.

Financial result

Along with high sales, Warta has been generating very good financial results, which is evidence to the fact that new customers have been attracted on the basis of healthy and rational rules. The technical account of the property company in 2017 showed a balance of PLN 309.4 million. Also, net profits remained high in the last year compared to the market as a whole at PLN 327.6 million. The technical account of the life company showed a balance of PLN 49.8 million and the financial profit was more than PLN 29.6 million. Both results showed a major improvement over 2016.

Traditionally, Warta has devoted much attention to the safety of its customers’ finances, which is evidenced with solvency ratios much above statutory requirements. Warta’s current rating from Standard & Poor’s has been maintained at the high level of A+ with stable prospects. Warta is the only insurance company registered in Poland with such a high rating.

Dawid Korszeń
Rzecznik Prasowy
Chmielna 85/87
00-850 Warszawa