– Insurance gap means any financial losses incurred in connection with the occurrence of specific events that have not been insured, either in the private or public system. In other words, it is information about how we deal with the possible financial consequences of losing health or the death of a loved one. How will we cope in old age? Do we have enough money to contribute to our retirement to ensure a decent life? Finally, it provides information on whether we can cope with property losses, including: our houses and apartments, cars – explains Jan Grzegorz Prądzyński, president of the Polish Chamber of Insurance (PIU).
Insurance is one of the methods of financing the possible consequences of undesirable events.
– We can also build a financial cushion in other ways, e.g. by saving and investing – explains the president of PIU.
The problem is that if we take into account the level of savings and debt of Poles, it turns out that many private individuals will not be able to finance such large needs, and for companies, at best, it will mean a huge, unplanned expense.
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Unfortunately, there are many examples of the existence of a dangerous insurance gap in Poland. The Swiss Re Institute estimated that Poland is only in 15th place among the economies with the highest index of resistance to the effects of natural disasters out of the 39 countries examined. The risk of disasters is therefore high. At the same time, according to PIU data, less than 50 percent residential and business properties are protected by insurance. In turn, the gap in the health care system in Poland is estimated at PLN 22.1 billion using the definition of the Swiss Re Institute and the Geneva Association, based on unreimbursed direct household expenses for health services. Let’s take a look at transport – in Poland at the end of 2023, there were 7.4 million AC contracts and 28.1 million third party liability insurance contracts. This means that only 26.3% had voluntary insurance. vehicles. To add to the problem, life insurance policies do not sufficiently protect loved ones in the event of the insured’s death.
– At PIU, we decided to prepare the report “Poles and risk – how do we insure ourselves?” The insurance gap in Poland” on this topic, which is primarily a valuable analysis for insurers, but also more broadly – for the financial sector – says Jan Grzegorz Prądzyński.
The problem of underinsurance is exacerbated by the fact that – especially in recent years – the prices of various services and products have been going up. An insurance policy of the same value five years ago, for example, could have been used to replace damaged property, whereas today it is absolutely not enough.
– Inflation and price increases affect every area of life, so replacing assets today will be much more expensive than a few years ago. All the more so because as a society we are constantly getting richer, building and developing infrastructure. Healthcare has become very expensive. Modern medical procedures are becoming more and more effective, but also expensive. The replacement rate in pensions will decline because we are aging as a society. This means that subsequent generations will receive less money when they retire, says Jan Grzegorz Prądzyński.
In the e-edition of Dziennik Gazeta Prawna, in a special supplement, you can read the key conclusions of the PIU report on how large and dangerous the insurance gap is in Poland and how it can be dealt with.
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Read more in the DGP supplement | Insurance
