Poland: The 2007 results for the CU Poland group are the best in history

2007, the year when the Commercial Union group celebrated 15 years of activity in Poland, also turned out to be the best year in terms of sales and financial results.

  • The Commercial Union group: the growth of assets is the best indication of this success

2007, the year when the Commercial Union group celebrated 15 years of activity in Poland, also turned out to be the best year in terms of sales and financial results. The best indication of the growth of the CU finance and insurance group is the total value of assets managed - their value increased by 20% to almost 55 billion zlotys.

The group's sales in Poland and Lithuania exceeded 6 billion zlotys (60% more than in the previous year). The driving force behind this growth has been single premium products and bancassurance (insurance offered in banks). A symbol of this new stage in the group's development is the new logo and new visual identity introduced in October 2007. The group is working on a number of strategic products: it is developing CU Direct motor insurance and creating insurance companies with Bank Zachodni WBK. The gross premiums written for CU Life exceeded 3 billion zlotys for the first time and the CU pension fund reached the highest rate of return in the business for 2007.

Adam Uszpolewicz, president of the CU Poland group: "We have achieved the highest level of sales and the best financial results in history. We have held on to our position as the market leader for pension and individual life insurance funds, and at the same time we are investing in the future. We have introduced motor insurance, sold through our direct system (by telephone and internet). We also plan to sell other property insurance policies in the same way. Together with Bank Zachodni WBK we are creating two insurance companies, which in the third quarter of this year will offer the bank's customers specially prepared insurance products."

CU Life: the success of bancassurance and single premium policies

  • The gross premiums written exceeded 3 billion zlotys for the first time, representing an increase of 28%.
  • Single premium policies sold outside the bancassurance system, particularly the new Bonus VIP product, generated a 25% higher premium.
  • CU Life's share in the assets market for insurance capital funds has remained at a level of 34.6%; the gross premiums written stand at 12.3% (information for the third quarter of 2007 - see graph in the appendix).
  • New sales through bancassurance have grown at the fastest rate in accordance with market trends. The premium received, 560 million zlotys, was three times greater than in the previous year, mainly thanks to the collaboration with BZ WBK and Deutsche Bank PBC.
  • The restructured portfolio of products includes the following: Nowa Perspektywa (New Prospects), the flagship individual life insurance product; Bonus VIP - an investment insurance product with a single premium.
  • The results of insurance capital funds were very good: the funds CU Dynamiczny (CU Dynamic) and CU Akcji (CU Shares) occupied first and second place in the rankings for the last five years, published in "Rzeczpospolita" (24 January 2008).
  • Last year CU Life paid out to their customers on over 36,000 claims. The largest payout on the death of one person was a total of over 3 million zlotys from a group and an individual insurance policy. The largest payout due to inability to work was over 460,000 zlotys, while the largest payout due to serious illness was 250,000 zlotys. 

Commercial Union Poland - Towarzystwo Ubezpieczeń na Życie SA (Life Insurance Company) - results:

Item

2007 [million zloty]*

 2006 [million zloty]

Change [%]

Gross premiums written

3,139

2,452

28

Value of assets

14,288

12,550

14

Compensation and claims

1,286

994

29

Canvassing costs

225

            188 

20

Administrative expenses

149

128

16

Technical result

366

360

2

Gross financial result

500

480

4

Net financial result

449

420

7

Equity capital

1,136

1,102

3

Gross technical and insurance reserves

12,976

11,181

16

Investments

14,159

12,408

14

* Information for 2007 before the audit

CU PTE (Universal Pensions Company): the biggest fund, the best results, the lowest unit cost

  • The most important benefit for customers: CU OFE (Open Pension Fund) achieved the best investment results amongst pension funds in 2007.

Pension fund

Rate of return in % in 2007  

Commercial Union

7.18

AIG

7.12

Pekao

7.06

Skarbiec-Emerytura

6.96

PZU Złota Jesień

6.95

Allianz

6.61

Axa

6.38

Aegon

5.95

Generali

5.81

Nordea

5.50

ING NN

5.23

Pocztylion

4.58

Dom

4.09

Bankowy

3.54

Polsat

2.20

  • One of the two most popular funds amongst customers, both amongst those joining an open pension fund for the first time (19.5% of these chose CU), and those changing fund (16% chose CU).
  • Very few CU OFE customers leave our funds - the rate of customers leaving is amongst the lowest on the market, considerably below average (in 2007 1.9% of customers left CU OFE, whereas on average 3% of customers left their fund in general).
  • Good balance transfers (or a change of fund by customers) for CU OFE.
  • A move up the rankings showing the capital growth rate of fund members - the average value of assets in active accounts in CU OFE is the highest on the market, whereas the proportion of accounts without premiums is the lowest.
  • We have held onto our position as market leader in the following categories: number of customers, value of assets, value of premiums transferred by ZUS.
  • Awards: Student Product of the Year 2007; the "Byki i niedźwiedzie" (Bulls and Bears) prize for the best Open Pension Fund in 2007 (awarded by "Parkiet").
  • Good results of CU PTE as a managing company: expenses are growing at a slower rate than income, and at the same time the aggregate payments from customers are the lowest on the market (according to the IGTE (Polish Chamber of Pension Funds) report in 2007 this figure stood at an average of 1.1% of assets).

Commercial Union Powszechne Towarzystwo Emerytalne BPH CU WBK SA - results:

Item

2007 [million zloty]*

2006 [million zloty]

Change [%]

Income from sales including:

363.7

308.0

18

        a) fees on premiums paid

191.9

172.9

11

        b) open pension fund management fee

158.4

127.5

24

Costs of open pension fund management**

144.6

126.5

14

Result from operating activities

219.5

175.5

25

Result from investments

10.9

15.4

-29

Net result

186.5

154.5

21

* Information for 2007 before the audit.

CU TUO (General Insurance Company): the start of motor insurance

  • Events during the year: a set of motor insurance offers sold over the telephone and the internet has been introduced.
  • The net premium exceeded 100 million zlotys for the first time in the company's history.
  • The growth in premiums is mainly thanks to individual insurance customers (particularly home insurance customers) and bancassurance. Customers willingly insure their home for two or three years at a time.
  • In terms of company insurance, the fall in rates for longer insurance periods was still noticeable.
  • High administrative costs were the result of preparatory work to introduce motor insurance and the development of the sales platform for the direct system.
  • Insurance benefits for CU TUO customers: over 4,200 claims paid out for individual insurance policies and over 700 for company insurance policies. An interesting example: after a fire in a single-family house, around 2 million zlotys were paid out.

Commercial Union Poland - Towarzystwo Ubezpieczeń Ogólnych SA - results:

Item

2007 [million zloty]*

2006 [million zloty]

Change [%]

Gross premiums written

113.3

103.1

9.9

Net premiums written

100.4

78.9

27.2

Compensation expenses

19.4

16.6

16.9

Canvassing costs

33.1

22.8

45.2

Administrative expenses

22.3

14.7

51.7

Technical result

-5.4

11.0

-

Gross financial result

-1.7

15.8

-

* Information for 2007 before the audit

CU TFI (Investment Funds Company): higher figures for sales and fund assets in spite of market turbulence

  • The sale of CU TFI funds during a difficult second half of the year was twice as high as the year before, reaching 1.5 billion zlotys.
  • A marker of this success is a 46% growth in the value of fund assets at the end of the year in spite of greater uncertainty on the market. CU TFI's share in the market rose from 1.82% at the end of 2006 to 1.94% at the end of 2007.

Commercial Union Poland - Towarzystwo Funduszy Inwestycyjnych SA - results:

Item

2007 [million zloty]*

2006 [million zloty]

Change [%]

Sales revenues

84.3

46.7

81

Operating expenses

63.6

34.0

87

Gross financial result

22

14

57

Net financial result

17.7

11.3

57

Net asset value of CU TFI investment funds

2 624.1

1 792.0

46

* Information for 2007 before the audit

Aviva Lithuania

  • In December 2007 the company changed its name from CU Lithuania to Aviva Lithuania.
  • It occupies third place in the life and pensions insurance market, beaten only by two banking competitors - Hansa and SEB.
  • Sales figures were over 12% higher than the previous year, also thanks to growing involvement in bancassurance. The gross premium rose by 46%.

Aviva Lithuania - results:

Item

2007

[million Lithuanian litas*]**

2006

 [million Lithuanian litas]

Change [%]

Gross premiums written

70.9

48.5

46

Compensation and claims

8.9

2.4

271

Canvassing costs

11.4

9

27

Operating expenses

12.4

11.1

12

Net financial result

8.2

2.2

273

* 1 lita = 1.0374 zlotys (average rate from the National Bank of Poland on 31.12.07)

** Information for 2007 before the audit

-ends-

Information:

Bohdan Białorucki
Telephone: (22) 557 43 41
E-mail: public_relations@cu.com.pl

Grzegorz Mathea
Telephone: (22) 557 43 70
E-mail: grzegorz_mathea@cu.com.pl

Additional information can be found at www.cu.pl/

Notes to editors:

The Commercial Union Poland group is part of the international Aviva group, the world's fifth and Great Britain's number one insurance organisation in terms of revenue. The Aviva group operates in 30 countries. It occupies a strong position in Great Britain, Ireland, France, Holland, Spain, Italy, Poland, the USA, Canada and Australia. It services over 40 million customers around the world, has an annual revenue of around £41.5 billion and manages assets to the value of over 364 billion pounds. For additional information see: www.aviva.com/

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