New agency, new funding, new players in growing insurance market
Last week, a major private German insurer and two new Polish companies entered the insurance market here. Another German insurer, Allianz Holding Munchen signaled last week from Budapest their intention to enter the Polish market.
The moves come on the heels of parliamentary action on a revised insurance law designed to protect policy holders against the risk of failure by private insurers and preserve a Polish presence in the business. Industry spokesmen said revisions to the new regulations, though minor, will bring the industry more into line with its counterparts in the West.
Gerling-Konzern Allgemeine Versicherung AG of Cologne announced it will acquire 51.2% of the stock of ATU SA. The deal will give Gerling a 48% voice in shareholders' meetings. ATU is Poland's largest tourist and travel insurance company, with operations in tourist hotels of the Orbis group. It billed premiums worth $7.2 million last year.
Gerling, part of the privately-held Gerling Group, reported billings last year of DM 14 billion ($10.1 billion). Rolf Gerling holds 70% of the company, with the remainder held by the Deutsche Bank. One-third of ATU stock is held by the state-owned Orbis.
Two new insurance firms, Towarzystwo Ubezpieczeniowe PBK SA (PBK Insurance) and Rejent Life, a mutual insurance company, registered with the Finance Ministry last week. Including the newcomers, a total of 39 firms are licensed to sell insurance. PBK Insurance is chartered to Powszechny Bank Kredytowy SA.
The sale of ATU stock means that almost one-third of the insurance companies in Poland now have foreign shareholders or partners. Under legislation passed in 1990 and revised by the Sejm late last month, foreign companies may only sell insurance in this country in partnership with Polish firms, or as registered Polish companies until 1999, when Poles will be able to buy insurance from outside of the country.
One insurance executive, who asked that his name not be used, said he felt the 1999 deadline was useful, so long as the market is opened up after that time. "It is good for Polish companies, giving them time to adapt to the new market conditions."
Other provisions of the new insurance law would create a special Office for Insurance Supervision (PUNU). Presently, insurance companies are supervised by the Finance Ministry.
"Today, the Ministry regulates the insurance industry, and it also has an interest in the two state-owned insurance companies (PZU and WARTA)," observed Miroslaw Kowalski, sales and marketing manager for Commercial Union Polska. "A separate agency would be better for the private firms and would be more in line with the way it is done in Western Europe."
*ukasz Kalinowski, vice-president and chief operating officer of Amplico Life, also believes the establishment of PUNU will improve the regulation of the industry. He said, "perhaps it will be better able to supervise the industry as a separate entity from the Ministry."
Kalinowski said he believed the funding of PUNU would come from insurance premiums, which would add to the administrative cost of doing business, but also would get supervisory costs out of governmental expenses.
The new legislation also would establish a permanent fund, to protect the benefits of policy-holders whose companies might go bankrupt. The fund, to be paid for with .03% of premium payments, would cover 50% of life-insurance benefits, up to a maximum of $39,000. Kalinowski considers the permanent fund an improvement over the current system, which sets up funds only after insurers slide into bankruptcy.
But Kowalski of Commercial Union called the level of guarantee "very modest" and said he would like to see it "higher and more protective."
Revisions to the insurance law were first submitted to the Sejm in 1993 and passed the lower house on April 21. The draft legislation has been submitted to the Senate, after which it must be signed by President Lech Walesa before it becomes law.
The moves come on the heels of parliamentary action on a revised insurance law designed to protect policy holders against the risk of failure by private insurers and preserve a Polish presence in the business. Industry spokesmen said revisions to the new regulations, though minor, will bring the industry more into line with its counterparts in the West.
Gerling-Konzern Allgemeine Versicherung AG of Cologne announced it will acquire 51.2% of the stock of ATU SA. The deal will give Gerling a 48% voice in shareholders' meetings. ATU is Poland's largest tourist and travel insurance company, with operations in tourist hotels of the Orbis group. It billed premiums worth $7.2 million last year.
Gerling, part of the privately-held Gerling Group, reported billings last year of DM 14 billion ($10.1 billion). Rolf Gerling holds 70% of the company, with the remainder held by the Deutsche Bank. One-third of ATU stock is held by the state-owned Orbis.
Two new insurance firms, Towarzystwo Ubezpieczeniowe PBK SA (PBK Insurance) and Rejent Life, a mutual insurance company, registered with the Finance Ministry last week. Including the newcomers, a total of 39 firms are licensed to sell insurance. PBK Insurance is chartered to Powszechny Bank Kredytowy SA.
The sale of ATU stock means that almost one-third of the insurance companies in Poland now have foreign shareholders or partners. Under legislation passed in 1990 and revised by the Sejm late last month, foreign companies may only sell insurance in this country in partnership with Polish firms, or as registered Polish companies until 1999, when Poles will be able to buy insurance from outside of the country.
One insurance executive, who asked that his name not be used, said he felt the 1999 deadline was useful, so long as the market is opened up after that time. "It is good for Polish companies, giving them time to adapt to the new market conditions."
Other provisions of the new insurance law would create a special Office for Insurance Supervision (PUNU). Presently, insurance companies are supervised by the Finance Ministry.
"Today, the Ministry regulates the insurance industry, and it also has an interest in the two state-owned insurance companies (PZU and WARTA)," observed Miroslaw Kowalski, sales and marketing manager for Commercial Union Polska. "A separate agency would be better for the private firms and would be more in line with the way it is done in Western Europe."
*ukasz Kalinowski, vice-president and chief operating officer of Amplico Life, also believes the establishment of PUNU will improve the regulation of the industry. He said, "perhaps it will be better able to supervise the industry as a separate entity from the Ministry."
Kalinowski said he believed the funding of PUNU would come from insurance premiums, which would add to the administrative cost of doing business, but also would get supervisory costs out of governmental expenses.
The new legislation also would establish a permanent fund, to protect the benefits of policy-holders whose companies might go bankrupt. The fund, to be paid for with .03% of premium payments, would cover 50% of life-insurance benefits, up to a maximum of $39,000. Kalinowski considers the permanent fund an improvement over the current system, which sets up funds only after insurers slide into bankruptcy.
But Kowalski of Commercial Union called the level of guarantee "very modest" and said he would like to see it "higher and more protective."
Revisions to the insurance law were first submitted to the Sejm in 1993 and passed the lower house on April 21. The draft legislation has been submitted to the Senate, after which it must be signed by President Lech Walesa before it becomes law.
