Axa in advanced stages to sell Polish side of business
French insurer Axa announced its intentions to sell the Central European side of its business back in October 2019. And, against the backdrop of Poland’s attractive motor and housing insurance, Generali, Uniqa and VIG are frontrunners for the takeover, Intelligent Insurer has learned.
Overall, the Polish insurance market is in a healthy position and is only now seeing the first signs of softening, according to a source familiar with the market. But companies are beginning to reassess their stance in the region.
Grzegorz Podlesny, partner at Sollers Consulting, told Intelligent Insurer: “The Polish insurance market is now going through a period of consolidation, companies are reconsidering their strategies as not all of them have reached their goals and I expect this consolidation to continue.”
While Axa is considered a strong player in the Polish market, an industry expert told Intelligent Insurer that the Polish side of the insurers business was struggling and lacked scale. In the first half of 2019 for example, Axa lost 11 percent of the market in the Polish life insurance sector. And, despite Poland being the flagship insurance market in the CEE region, according to Podlesny, it ended the first half of 2019 with only a modest increase in gross written premiums (GWP) of 2.65 percent.
According to Sollers Consulting, motor insurance lines provided this extra premium volume, which were a result of increasing car sales in the region. The most visible impact was recorded on the Motor Hull line, for which GWP increased by €70 million, to reach €1.04 billion ($1.14 billion). Podlesny said that motor insurance, a sector that comprises 60 percent of Poland’s total insurance sector, will see fierce competition in the future.
A market source pointed to Generali and VIG as the most likely to secure the takeover, as both have a strong presence in Central Eastern Europe.
“Generali wants to expand in Eastern Europe. They acquired the Polish life insurer Concorda in November 2018 and are now in advanced talks with Metlife to take over the US insurers Eastern European business,” the source said. With PZU possessing a 35 percent market share and Warta with 18 percent, the new company will be a strong third player in the Polish market.
Podlesny added that the Polish insurance market is becoming more modernised and is well developed technologically. And, having implemented core systems, insurers in the region are exploring how to make better use of their modern IT infrastructure. Podlesny believed that as insurers usually integrate new companies quickly, the acquisition will drive further market modernisation.
Axa have been contacted for further comment.
