Adam Uszpolewicz, chief executive, CU Poland Group: "The falling stock exchange prices and the greater degree of uncertainty in the financial markets have not prevented us from achieving many important objectives. We have increased our share both of the life insurance and of the property insurance market."
Adam Uszpolewicz, chief executive, CU Poland Group: "The falling stock exchange prices and the greater degree of uncertainty in the financial markets have not prevented us from achieving many important objectives. We have increased our share both of the life insurance and of the property insurance market. This became possible thanks to the excellent New Perspective life insurance, the dynamic growth of bancassurance sales, new investment products and direct sales of motor vehicle insurance. At the same time, we have maintained our leading position in the pension fund market. We are paying out more and more benefits to our clients and generating profits for our shareholders.
"We are pleased by the successful introduction of the Aviva brand by our Lithuanian subsidiary in December 2007. Its good first half results are a promising sign ahead of the planned introduction of the Aviva brand in Poland in the coming two years."
CU Life: High level of sales of regular contribution policies
- The highest level of regular contribution policy sales for almost six years: H1 sales of individual insurance grew by 30% and of group insurance by over 60% from their levels in H1 2007.
- CU Life owes this performance above all to sales by agents for New Perspective - a modern individual life insurance product with a number of additional options, introduced in 2007.
- Development of our structured product offering in response to client demand in a period of high market uncertainty: three subscriptions through our own distribution network and two through bancassurance. CU Life also offers a unit-linked insurance product, Bonus VIP, with limited-period guaranteed return dependent on the selected investment strategy.
- Total gross premium income rose by 54% from its H1 2007 levels. The most dynamic (fourfold) growth occurred in bancassurance.
- CU's market share measured in terms of gross premium income was over 18% (based on Q1 2008 data)
- The value of assets held in unit-linked insurance funds fell only slightly in spite of the difficult financial market situation.
- In H1, CU Life settled over 19,000 of its clients' claims. They included the highest payment in the company's history of 812,000 zlotys made under an incapacity to work endorsement. The highest death benefit was over 500,000 zlotys. The highest group insurance benefit was 300,000 zlotys (under the critical illness option).
- Net financial performance below that achieved in H1 2007 was due above all to poorer investment performance.
Commercial Union Poland - Life Insurance Company SA - Performance:
| Description | H1 2008 [mln zlotys] | H1 2007 [mln zlotys] | Change [%] |
| Gross written premium income | 2,398 | 1,562 | 54 |
| Asset value | 14,117 | 14,499 | -3 |
| Claims and benefits | 860 | 627 | 37 |
| Acquisition costs | 112 | 110 | 2 |
| Administration costs | 73 | 73 | 0 |
| Technical performance | 187 | 190 | -2 |
| Investment performance | 81 | 141 | - 43 |
| Gross financial performance | 268 | 331 | -19 |
| Net financial performance | 238 | 306 | -22 |
| Equity capital | 882 | 930 | -5 |
| Technical reserves | 12,824 | 13,295 | -4 |
| Investments | 13,794 | 14,335 | -4 |
CU PTE: The largest fund, the lowest cost for clients
- The average value of funds in the CU OFE client accounts continues to be the highest in the market, with the lowest percentage of dormant accounts.
- CU OFE is one of the market's two most frequently chosen funds.
- Careful asset management during a period of increasing capital markets volatility confirmed by the highest security of investment rankings.
- Increasing client loyalty - lapse rate among the lowest in the market, much below average (in the first half of 2008 approx. 1.6% of clients left CU OFE, as compared with the market average of 3.1%).
- Maintaining market leadership in terms of client numbers and asset value.
- Total fees charged to clients as a percentage of premiums received from the National Insurance Agency (ZUS) and assets under management are the lowest in the market.
Commercial Union PTE Universal Pension Company BPH CU WBK SA - Performance:
| Description | H1 2008 [mln zlotys] | H1 2007 [mln zlotys] | Change [%] |
| Sales revenue, including | 206.5 | 181.4 | 14 |
| a) Pension contribution charges | 110.1 | 90.7 | 21 |
| b) OFE management charge | 81.2 | 76.1 | 7 |
| OFE management costs, including | 82.0 | 77.6 | 6 |
| a) Payments to ZUS, KNF and RU | 22.0 | 18.7 | 18 |
| Operating performance | 124.8 | 103.9 | 20 |
| Investment performance | 8.6 | 5.9 | 48 |
| Corporation tax | 25.4 | 20.9 | 22 |
| Net profit | 108.0 | 88.8 | 22 |
CU TUO: Premium income and market share increasing thanks to direct motor vehicle insurance
- Significant increase of premium income, mainly due to direct motor vehicle insurance and other individual insurance products offered primarily by CU agents.
- Market share virtually doubled by comparison with last year (based on Q1 2008 data)
- Higher administrative and acquisition costs as well as the poor financial performance caused by significant investment in the development and promotion of direct motor vehicle insurance.
- Insurance benefits for CU TUO clients: 3,500 individual insurance claims paid, as well as 414 corporate claims.
Commercial Union Poland - TUO General Insurance Company SA - Performance:
| Description | H1 2008 [mln zlotys] | H1 2007 [mln zlotys] | Change [%] |
| Gross written premium income | 95.3 | 50.1 | 90 |
| Net written premium income | 85.4 | 42.4 | 101 |
| Claim costs | 17.5 | 10.2 | 71 |
| Acquisition costs | 37.6 | 11.9 | 215 |
| Administration costs | 13.6 | 9.8 | 38 |
| Technical performance | -25.1 | 1.1 | - |
| Gross financial performance | -21.7 | 1.5 | - |
CU TFI: Market share maintained in spite of difficult situation
- Value of assets under management fell due to the difficult market situation, but CU TFI market share maintained at 2%.
- Lower sales revenue due to the reduced flow of contributions to the funds and reduced share of funds investing in equities.
- Reduced operating costs allowed financial performance to be maintained at last year's level.
Commercial Union Poland - TFI SA Investment Fund Company - Performance:
| Description | H1 2008 [mln zlotys] | H1 2007 [mln zlotys] | Change [%] |
| Sales revenue | 32.0 | 39.2 | -18 |
| Operating costs | 21.8 | 29.8 | -27 |
| Gross financial performance | 11.0 | 10.2 | 7 |
| Net financial performance | 8.9 | 8.3 | 7 |
| Net asset value of CU TFI investment funds | 1,923.6 | 2,816.9 | -32 |
Aviva Lithuania
- The change of the Commercial Union brand to Aviva in December 2007 did not hinder the company's continued development - quite the contrary, in the first half of the year gross premium income rose by over 22%, and profit by 50%.
- The high claims and benefits figure is the result of the gradual "maturing" of the portfolio - the growing number of longer-term contracts on which benefits are paid more frequently.
- Acquisition costs have risen due to the increased sales volumes, while the increased operating costs were due, among others, to the one-off rebranding expenditure.
- Aviva Lithuania has been in operation since 2001. It offers life insurance and pension programmes. Its founder and sole shareholder is CU Poland Life Insurance Company.
Aviva Lithuania - Performance:
| Description | H1 2008 [mln litas*]** | H1 2007 [mln litas] | Change [%] |
| Gross written premium income | 38.9 | 31.8 | 22.3 |
| Claims and benefits | 6.9 | 2.8 | 146.4 |
| Acquisition costs | 11.4 | 9.1 | 25.3 |
| Operating costs | 3.5 | 2.4 | 45.8 |
| Net financial performance | 5.1 | 3.4 | 50.0 |
* 1 litas = 0.9714 zlotys (average NBP exchange rate on 30 June 2008)
-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
Further information www.cu.pl/
Notes to editors:
Commercial Union Poland Group is part of the international Aviva group, the world's fifth-largest insurance group, and the largest in the United Kingdom by revenues. Aviva Group operates in 30 countries. It occupies a strong position in the United Kingdom, Ireland, France, the Netherlands, Spain, Italy, Poland, the USA, Canada and Australia. Worldwide, Aviva group serves over 45 million clients and manages assets valued at over £364 billion. For additional information, see www.aviva.com