UPDATE: PZU insurer assumes increase in net profit to over PLN 6.2 bln by 2027 in its strategy

As the company reported, PZU's cumulative net profit for the last 12 months amounted to PLN 5.3 billion (EUR 1.23 bln) and ROE was 17 percent. The target for 2024 is a profit level of PLN 4.3 billion (EUR 998.9 mln) and ROE of 15.5 percent.

The group plans to focus on core business with a target of significant value growth, including an increase in gross insurance revenues to PLN 36.2 billion (EUR 8.4 bln), over 40 percent growth in EPS from core business

core business and over 20 percent operating margin in life insurance.

The group in its new strategy till 2027 is simplifying its structure and strengthening its operational agility, and estimates PLN 400 million (EUR 92.9 mln) through efficiencies and synergies within the group.

It also assumes a reduction of the COR ratio to below 90 percent in non-life insurance and up to 25 percent market share in bancassurance in Poland meaning a strengthening of the leadership position.

In the area of PZU's bancassurance, the strategic objective is a new approach to offering insurance linked to bank products, the expansion of the range of non-linked protection insurance and services and savings and investment products, as well as an omni-channel distribution and service model.

PZU is targeting a 50 percent increase in the number of insured customers in PZU group banks.

The insurance group assumes strong growth in the booming business insurance market.

As key growth levers in the coming years, PZU identifies the participation in the largest investments: national recovery plan KPO, green transformation; increasing the use of data in quotes and new pricing models; loyalisation of key customers using operational support and risk reduction programmes; automation of sales and service processes using new technologies and GenAI.

PZU wants to invest in the health market, digitisation and offerings developed with partners, including plans for a PLN 1 billion (EUR 232.3 mln) investment in health; and assumes 8 million of mojePZU (myPZU) customers through digitisation of the service model.

In the health area, revenue is set to increase to over PLN 3 billion (EUR 696.9 mln), which translates into over 60 percent growth; and EBITDA is set to double.

The group also plans to increase its exposure to green transformation (PLN 3 billion or EUR 696.9 million of new investments), to innovation and technology and to expansion of its product offering for external customers.

Further growth in customers of the mojePZU (myPZU) channel is also assumed - up to 8 million clients in 2027 and 60 million logins.

PZU insurance group is present in five European countries and plans to continue to grow in a light expansion model. It assumes PLN 500 million (EUR 116.2 mln) of additional revenue from active reinsurance outside the group by 2030.

PZU's strategy assumes global opportunities, including growing risk awareness, which will accelerate growth in the non-life insurance market to USD 1.3 trillion in 2040, at a 5.3 percent CAGR 2020-2040, as well as increasing demand for medical services and the potential for savings through artificial intelligence on the costs of financial institutions' underwriting and collection systems.

Local opportunities include Poland maintaining the highest economic growth in Central and Eastern Europe, outlays estimated to meet Poland's energy transition goals and increased demand for investment products as a result of increased savings by Poles.

Under the ESG framework, PZU plans to reduce CO2e emissions in corporate insurance in terms of customer declarations by 2030, as well as to expand product assessment and incorporate ESG factors in insurance risk assessment and tariffs.

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