Welcome. Today, we will be discussing the results of PZU in 2025, and with a special focus on Q4. Bogdan Benczak, CEO of PZU SA , and Tomasz Kulik, Member of the Management Board of PZU, Chief and CFO of the PZU Group, will take the floor.
Good morning, ladies and gentlemen. Welcome! This conference will be dedicated to a very exceptional year. 2025 was an extraordinary year for the PZU Group. We had to face many challenges, but thanks to hard work and teamwork, we were able to achieve record-high results. We are going to discuss this today. Almost PLN 31 billion of premium, PLN 1.5 billion more than 2024, with the profit of PLN 6.7 billion and solvency of around 234%.
Last year, we paid out PLN 4.47 dividend, with a high dividend yield. These are record-high results for the group. Dynamic income growth, over 25%, PLN 6.699 billion, this is what we achieved. Out of this, PLN 4.5 billion accounts for insurance, and PLN 2.2 billion comes from our banking activity. ROE stands at over 20%, and this is largely thanks to a high result on insurance, PLN 4.8 billion, and good result of the investment portfolio, PLN 2.7 billion, with a contractual margin of over 27%, a combined ratio at the level of 86.2%. These are very good results. We have broken the record here. Let me give the floor now to Tomek, CFO.
The main takeaway of this chart is the following: The distribution of the result this year is, might be a bit different from what you were expecting. I'm referring to how the group generated results in 2024. Now let me highlight a couple of differences here. The differences concern 2024, 2025, and different quarters. We all remember that last year, the previous year, there was the flooding, and this led to a lot of claims related to flooding. In Q4, usually, when speaking about the, the death rate and life insurance-related parameters, we analyze them, and this usually serves us to make estimates for the next year. Last year, we had to be quite conservative when it comes to the revenue. The...
This is largely because we are expecting a completely different behavior of the life insurance segment, because I'm referring now to the death rate. Actually, how the death rate unfolded didn't meet our expectations, and we benefited largely from the situation here. The assumptions changed in Q4. This year, we are meeting a month earlier than last year. This affects some processes which usually appeared in Q3 and were moved to Q4. At points, this might lead to a situation where it might be a bit harder to understand how to compare different quarters in 2025 and 2024. My message here is the following: the average result is PLN 1.6 billion, and this is significantly more than in 2024.
We are an insurance and banking group. The insurance leg has very strong foundations. Have a look at the profitability and the combined ratio. It stands at 86%. In Q4, it was similar. This means that we have a very strong position speaking about the strategy for 2026 and 2027. The business is solid. The investment portfolio's performance is sound. There were some tactical moves in Q4 related to portfolio to freeze, to keep this very good profitability for longer. We'll discuss this later on. The P&L is solid. On equity, profitability is over 20%. This means that we should be optimistic about the dividend. As Tomek has mentioned, we closed the year faster, 2025.
In 2025, we scaled up our activity. We expanded our complementary offer. The growth in non-motor was double digit. We are very happy about it. The very good trend in life and protection insurance continues here. The growth is also double digit. We are happy with the changes in the health pillar, where the growth is around 14% like-for-like. The number of external customers in our three TFIs has gone up as well. Our credit rating is A minus with a positive outlook. The solvency ratio is very high as well. It's over 200%. After three quarters, the solvency stands at 234%.
This means that we have all that it takes to be very optimistic about the dividend for 2025, as Tomek has already mentioned. You know that according to our strategy, in 2027, the dividend will stand at over 4 zlotys, 4 zlotys and 5 groszy. We are in a very good position to think about a very attractive dividend here. Now, our investment portfolio. As Tomek has mentioned, a very good result when it comes to the deposits. 71% of our portfolio amounts accounts for sovereign bonds, and we have very good reinsurance protection as well. Q4 and 2025 now. We were setting priorities for our strategy in Q4, and we think that there are great opportunities for the PZU Group to...
Because of the improvement of the economic situation of Poland is now among the 20th, the 20 largest economies, and the purchasing power is growing. We would like to seize this opportunity and offer the best possible products to our customers so that we can make the most of this positive economic cycle in Poland. At the same time, we would like to drive the growth of the GDP, and we would like to offer insurance services, but also financing for investment projects that will contribute to the development of the Polish economy. We know that there are challenges on the market. I'm referring to MTPL here. We know that the market is soft, so to speak, and there are more and more competitors. We need to prepare for the changes in the distribution market.
The role of intermediaries is growing, but the Group has a very strong chain network of own agents, and these are our sales special forces we would like to make the most of, and we would like to expand. At the same time, we need to keep an open mind.
We are considering other options to remain competitive in this aspect. At the same time, as we know, interest rates have been going down. As a result, we need to take this into consideration in our deposits-related activities. Any changes in the interest rates will have an effect on our banking activities. We have prepared different activities and set KPIs to prepare the group for 2026 and the challenges. As I've said, we are very happy with the record high results in 2025. As an organization, we are getting ready for the challenges of 2026.
We will tell you about the initiatives we are going to support in a moment, but we have identified our weak points, and we have prepared a list of measures to be taken to become an unquestionable leader of the market again.
Let us begin with mass insurance. In that sector, we focus on modernizing our sales. We have planned, and we are currently implementing a new front-end system. In this system, we want to unify our approach, make it more consistent, which will make it easier for our agents to work, and it will also be easier to start working with intermediaries. We also want to change, optimize our tariffs and our underwriting. We have reorganized our organization in a way that will strengthen the data scientists team. We also decided to develop our machine learning models, and we have laid the groundwork for technical change by moving to a cloud. We also have a number of AI tools implemented in our underwriting procedures. I am very happy with how some of our products have changed.
For instance, the PZU Home, it has been revised, remodeled, and our clients were quite enthusiastic about its new version. This is a good case in point illustrating that we are able to develop and grow our products, and the changes are very welcome. We intend to continue to develop our product portfolio in particular in motor insurance. We have also introduced a new claims handling system, which is more efficient than the previous one. Tomasz Tarkowski is the person in charge. We hope that we will see the first benefits of this new procedure and the new system in 2027. Over the last two years, we have made a large progress in that area, but there is still a lot to do, and we can further improve our effectiveness. Life insurance.
I'm very pleased with the riders that we have added to individual insurance policies. Tomek will tell you more about it. We're pleased with the results and we'll continue in that vein. We have also changed our group insurance pillar, including life insurance. We also want to offer a new integrated insurance products. For instance, PZU travel assistance in cooperation with the LOT Polish Airlines . We have also decided to introduce a standalone insurance in bancassurance. This is our response to low interest rates. Basically, in response to low interest rates, we want to transform our bancassurance offer and to move from interest based approach to commissions. We also have.
um, launched a project together with, uh, PKO Bank, and this is the way we want to proceed in the future, like to have more of, uh, similar, uh, joint ventures. Uh, we are moving towards, uh, um, digital channels of communication with our partners and customers, and brokers. We are introducing a number of AI-based automated, uh, solutions in our foreign companies. PZU in the Baltic States has been, uh, growing, uh, very well. Its combined, uh, ratio is comparable to our Polish, uh, branch. So, uh, in short, our, uh, results in the Baltic States are very good. A few words about Ukraine. Actually, I would like to share a few thoughts with you. Last week, I went to Kyiv. I met with our colleagues there, and I must admit that I'm very impressed with their resilience. They're operating in very difficult conditions.
I'm also sure that the profit they generated in 2025 in Ukraine constitute a good basis for business growth, even despite the difficult situation in which they are in. We're also growing our foreign inward reinsurance. Our team has already signed a few contracts in that area. We also want to sign MGAs with chosen partners. Those partners are present on the markets in our part of Europe. In 2025, we have improved the operations of our health pillar. We have invested into it, and we've been growing organically, so this means that we have opened a number of greenfield facilities, and we continue to plan further investments. In 2026, we want to open new greenfield facilities and to carry out acquisitions.
We want to improve operations of our facilities. In particular, we want to make sure that as much communication as possible is in digital form. This will make the health pillar of our activity more effective. We want to seize the opportunity that the current financial ecosystem gives us. As I have said, Poland has joined the G20. The purchasing power of our clients is growing. This means that we need to optimize our investments and deposits. I believe that we need to seize the opportunities that the Polish growing GDP is presenting us with. We want to participate in Innowo.pl , not only. On the 17th of March, we will offer our first ETF fund.
We will also offer other investment products, such as FIZ Private Debt, and it's a joint undertaking with PKO Bank. Our main focus is organic growth, as well as optimizing and finding innovative applications for artificial intelligence. Currently, PZU operates over 30 solutions based on artificial intelligence, and we're not resting on our laurels. We want to benefit from synergies that we have with PZU Ready for Startups program. This means that we are implementing some business ideas that have received positive reviews. We have also introduced an AI assistant for our employees, and last year, this tool generated 1.7 million prompts.
In 2026, we want to deploy a new IT strategy. A significant weakness that was diagnosed after 3 quarters of 2025 is technological debt. It was this weakness was diagnosed by the board, we decided to transform our IT framework to make better use of data and the digital solutions. Wherever it's possible, we want to use cloud-based solutions, artificial intelligence, and the so-called low-code based solution. Our goal is to shorten the time to market, to reduce our costs, to improve the efficiency of our IT systems. Security is our top priority, all our systems, especially the critical systems, will be covered by the digital resilience mechanisms developed under our strategy.
In a moment, I will give the floor to Tomasz, who will tell you a bit more about the fourth quarter of 2025, which was also quite unique. As Tomasz said, we have drastically accelerated the process of closing the accounts for 2025. Without further ado, Tomasz, I'm giving you the floor.
Thank you. As usual, we will begin with non-motor and non-life insurance. Let us begin with the written premium and revenue. Q4 was a two-speed quarter. The growth was at 2% year-over-year. We have observed the good dynamics in non-motor insurance. The corporate segment went up by 5.9%, including construction insurance and property insurance. Motor insurance adjusted for Q4 2024. The market is quite saturated.
There is an interesting ratio of MOD to MTPL. Interestingly, the business of property insurance is based on two pillars, the motor insurance and non-motor insurance. I mention this because this allows us to forecast better, to have higher profitability, and to be less dependent on underwriting cycles that we have been observing mostly in non-motor insurance. In life insurance, we're doing more of the same, and I think it's a good idea. In mass and individual insurance, we have a group of new clients and a group of returning customers. I think that the health pillar is the most attractive part of this business. We have a strong competitive advantage with it over our competitors. Our offer is indexated.
We are offering new riders, and this allows us to keep the growth between 2% and 3%, and 2.5% to be more exact. In individual insurance, just like with non-life insurance, we have two main tendencies. The first one is stable growth in regular business, 24% year-over-year. This happens in the context of interest rates going down. This means that the return on deposits is lower, and the deposits are the guarantees of our products, so the sales of life and endowment seriously went down, especially in the banking sector. On the other hand, what we are witnessing right now is a shift from a single premium product to a regular premium product.
This does not affect the rate of growth of the number of clients, but it does affect the written premium value. Here, the value of a single transaction actually is important. In health, the growth is.
double digit, both for medical clinics and other facilities. Own facilities have witnessed a significant growth, and so have the partner facilities. This helps us manage the traffic of customers the right way, and we can keep the costs of medical procedures under control this way. Because we have control over the value chain that customers use, so we can control the cost, but at the same time, we can take care of the customer experience. Costs matter, so we are happy to see the fact that the number of online appointments is growing up. Actually, the number of appointments being booked online, the main channel, website, used for that purpose is called mojePZU , so My PZU. Also, the share of services provided in our own and partners' facilities is also going up.
There is one thing that this chart is missing, though. It's still an important thing to highlight. I have to say that this line of business has undergone huge transformation over the last 12 months. This line of business is about insurance, health, medicine, labor medicine, and the profitability rate here is almost 13%. There's a huge progress here. The contribution has gone up, so we are speaking about an interesting and very profitable chunk of our group. Assets under management. In Q4, the trends from the previous quarter is continued. PZU is number 1 in non-banking and number 3 in the full chart. Our share is almost 10%. ECS assets account for almost PLN 10 million, with an increase year-over-year of over 50%.
Bancassurance, as I've already mentioned, on the one hand, we are changing the model and shifting to a regular premium. I'm referring here to this distribution channel. There are some risks here. The face value decrease and the free credit sanction. These are the aspects here to be taken into account, it doesn't translate into a decrease in the number of customers. Our huge effort in Q4 was effective, you can see this in the results. The gross insurance revenue, here, the growth rate is a bit lower than Q4 2024, this is largely because of what's going on in non-life insurance. This is very visible in the first half of the year.
If you split it into different lines of business, well, different things are happening in different lines of business. Please bear in mind that the corporate business is growing significantly, almost 15% of growth year-on-year in insurance revenue. Mass insurance, non-motor, 6.6, as we have already discussed, but there's a drop in motor insurance. The adjustment year-to-year is over 6%. Life and individual business, again, you have double-digit results, individually continued, and with a slight adjustment year-on-year because of the high base, largely. This is related to the factors that I spoke about at the beginning, and I will come back to later on. Our reinsurance program remains largely the same. Net revenue is stable.
The cost of insurance services has gone up by 4%. The level of claims and benefits remains more or less at the same value with a slight change, although the portfolio exposure is larger. Here, importantly, the claims ratio has improved in non-life insurance. Some previous years' claims in the power industry sector have been solved, and this has had a positive effect. We have had stable profitability in MTPL, but MOD has slower margins now. The claims and benefits have gone up in the life and health part. Administrative costs have gone up in Q4. This is mainly because of the fact that salaries went up. First of all, there is the salary review each year, and we have to compare ourselves to the market, so salaries have gone up.
There were also one-off payments related to some collective disputes which have been resolved. Higher distribution costs, 3.2%. A bit higher than the insurance revenue. This growth is due to the fact that non-motor insurance has had a larger share in sales, and here the cost of distribution in general is higher. Actually this is good. This means more products with higher predictability and profitability. Now, the net loss component, which is amortization and other aspects. Here, these two items have had a negative effect. The overall influence amounts to around PLN 50 million, and last year the situation was the other way around, where the loss component was...
offset by the creation of new write-offs in this part of the portfolio, where the sum of costs is higher than the rates and premium, or to be more precise, the insurance revenue. The result on insurance is PLN 1.6 billion. Let me highlight that the loss ratio is low, with the loss component at the level of last year, and the difference is less than 1 percentage point. The non-life business is highly profitable, whereas the depreciation is 120 points, but this is still a very sound profitability. Let me highlight this. This is much more than we promised in our strategy. The margins in life insurance are over 20%.
We know that we can't use Q4 2024 as a benchmark here, and we all know why. Q4 ends with almost PLN 1.5 billion, PLN 1.474 billion, and on equity, 17.6%. Now, let's deep dive into each segment. A couple of things I haven't said so far. I've already told you about the revenues, so I'm not going to repeat myself. The costs have gone up by 6.6%, and what has happened here? The current claims liabilities have gone up, and there is a higher cost of motor and life claims. I'm referring here to the non-motor and life claims, and I'm referring to PZU Dom and PZU Firma.
This was partially set off by the positive evolution of the provisions from previous years, and this proves our conservative provisions policy and prudency, which usually has a delayed effect. There is a higher loss component mainly in MTPL. This, the effect of these two elements on Q4 amounts to PLN 57 million. This was caused by a loss component in agriculture insurance. The operating result went down to PLN 415 million. Please bear in mind, though, that the profitability of this segment is above our strategic assumptions. The combined ratio on the whole segment in Q4 was at 89.7%, 96.1% in motor products, and below 80% in non-motor. This is very good news!
Let me briefly present you the market situation and how the market may influence PZU's result in the coming quarters and years. In 2024, we had a number of negative trends. We had a 7% loss on TPL. The market started to show positive results in Q1 2025, that was actually surprising. The price dynamics was at 7.6% in TPL, in MOD at 3.5%, and we ended at levels below zero for both TPL and MOD. Currently, TPL is at -0.5%, and MOD at -3.9%. What does it mean? If the number of claims goes up, we will experience pressure to deliver results. An important piece of information, please do not jump to conclusions.
This important piece of information is that even though MOD has been showing negative trend for 3 consecutive quarters, it has been quite profitable. At the end of Q3, its profitability was at 8%, which is a lot. TPL also delivered good results in Q4, despite the negative general trends. On the whole, even though the circumstances in which we operate are not ideal, it does not mean that the profitability of our portfolio or the profitability of our colleagues will go down. The Polish Financial Supervision Authority started to apply sanctions for certain price related decisions taken by our competitors. Yes, the Financial Supervision Authority has decided to intervene.
We'll continue to observe this situation, and we hope that it's a part of a, like, systemic intervention and change that will overturn the trend. Non-life insurance, corporate insurance segment, the cost, the expenses in Q4 2025 were closely connected to a large number of claims. We have made very cautious forecasts regarding Q4 and careful estimates. We were actually so careful that in the end, the amount of claims paid out in that period was a rather pleasant surprise. This translated into a substantial increase of the operating result and improved profitability in all dimensions. In motor insurance, non-motor insurance, of the corporate insurance segment. Life insurance group and individually continued insurance. 2024 was not a representative year for PZU.
We agreed that keeping profitability at the level of 30% was untenable. If it was, we would have written a whole strategy on how to do it. We had two main messages concerning life insurance in 2024. I want to talk about the costs of claims. Here as well, we were very careful in making our estimates. We were not sure what we could what kind of death ratio we could expect still, as in post-COVID years. In 2024, we have been consuming CSM in an accelerated manner. Under normal circumstances, this would have been spread over a few years and depreciated over the entire cycle of the insurance. When you compare the revenue and the expenses with the previous years, you will realize that it's actually impossible to carry out a year-to-year analysis.
In Q4, we have changed the actuarial forecasts and assumptions by PLN 67 million. All other assumptions for this year remained regular. I just wanted to make this comment so that you can understand the mutual relationship of the two Q4s in question. Mortality. It might seem that the mortality rate has got back to normal. We're at the level of 3.5% less than Q4 2024. We're approaching the statistics that we have known in the pre-pandemic period, we might carefully assume that we can close the COVID chapter. Life insurance, individual protection insurance.
The cost is basically the effect of the scale and the exposure of this portfolio. The insurance revenue went up year-on-year by 23.8%, and the expenses by 27.4%. Margin, we've got high margins, good level of sale, including selling additional products, indexation. All those factors allow us to gradually and systematically build value from one quarter to another. This is very clear in case of a group and individually continued insurance, where the growth from one quarter to another was at 5%. Investment results. We did not have a great quarter, but still quite acceptable. Actually, our CEO has just said that it was helped me out, and he said that this was an exceptional or extraordinary quarter, just like the whole year 2025.
We had a good interest income, regardless of what happens to interest rates. We had lower results from valuation and realization of debt instruments. We have decided to sell a few tranches at lower profitability because, well, we all know that the interest rates will continue to go down, so we decided to carry out this transaction. What you see in the results are basically, it's a small adjustment of our exposure to corporate debt. There were some press articles about it. PZU is a part of a consortium with a number of banks, and we're involved in that transaction. Other than that, we have proceeded in line with our strategy. We also had a lower performance of equity instruments, in particular given the exposure to stock in the medical sector.
We have benefited from the tendencies on the capital market. For instance, we had a good yield year on year on our real estate portfolio. We have also had a positive exchange rate differences in real estate valuations. This was connected to the fluctuation of exchange rate between Polish zlotys and euro. Solvency. Our solvency ratio shows that our good results are not only on paper, but they can be monetized. We have a good result on our own funds, on investments, adjusted in line with our policy, and the dividends are expected at the level of 80% of the PZU Group's profit.
The second half of the year, we experienced an increased risk in banks and higher requirements and solvency, we're closing the year with the solvency ratio at 234%. Strategy. 2025, 2027. Gross insurance revenue. Given the current figures, we know that we need to speed up if we want to deliver on our ambitious KPIs. We said it when we published our strategy. We want to set the bar for ourselves quite high. This means that we need to speed up with delivering on our KPIs, the strategies that the CEO has mentioned in the first part of the presentation will help us to do so. We're still not flying on all engines. We believe that the active reinsurance will soon help us out, build our exposure, and will...
That will help us to benefit from this large reinsurance capacity in our balance sheet. Net profit. The last quarter and the last year, again, was extraordinary, and we have been stressing this many times. We have reported a profit year-over-year of 25%.
Let me stress that our OE from non-banking is over 20%. The earnings per share, non-banking is at the level, which is above our targets, PLN 5.23, with the insurance business being highly profitable, with a solid growth of the health pillar and assets management. Now over to the CEO to wrap up.
Thank you, Tomek. As you can see, ladies and gentlemen, it has been an extraordinary year with extraordinary results. There have been many different initiatives which are aimed at preparing PZU for the implementation of our strategy. As Tomek has said, on the revenue side, it's going to be a huge challenge for us, but we have identified all the challenges ahead of us, and we are prepared. We have all the KPIs set up, and we are implementing projects which are supposed to take us to our goals. Much for this part. Over to Magda. We have discussed our records, now over to you. Let's move on to the Q&A.
Let's start with questions from the floor. Good morning.
Congratulations on your results for 2025. I have a couple of questions....
What do you think about non-life insurance in Poland and the potential for growth in 2026, given all the things that the competitors are doing? Do you think it's likely for the revenue on insurance to speed up? The next question is about Solvency II and the changing regime. When do you think your internal risk assessment model will be validated by the regulator? Do you think it's going to happen sooner in the first half of the year or towards the end of 2026?
Let me start with the second question. We think, and we expect the model to be validated in 2027. It depends.
It also depends on the changes in the structure of the group, because there is the project of reorganization of the group, which is carried out together with PKO. You know, the term sheet has been signed, and you know that it all hinges on the legislative process. Internally, the company is getting ready for that, for the split. Let me stress once again that according to the current strategy of the group, the new Solvency II rules will take effect in January 2027. The strategic assumptions related to strategy and the dividend policy will be delivered. We are certain about it, because we think that reorganization is an opportunity for us to optimize the group, both organization and capital-wise.
Speaking about the internal models, we are in touch with the regulator, with the KNF, but we don't think it's achievable in 2026. Probably it's doable in 2027, but this is to be confirmed by the KNF.
Okay, before we go back to the question about the results, I do have one more question, though. As I understand, you will enter 2027, and the structure of your group is still uncertain. Let's assume that nothing will change. We already discussed the fact that the new Solvency II is already included in your targets, but could you provide us with guidance?
Because about around a year ago, there was guidance that if the Solvency II is implemented without any changes at all, there will be a capital excess in the group around PLN 1.5 billion. Is this right?
It depends on how you calculate it, and seriously. This is how I would like to answer this question. Where are we in terms of growth? Think about the outlook for this year and how it eventually evolves, because no one expected that this year to be so favorable in terms of the weather. 2027 is very likely in terms of us reaching the KPIs from the strategy, and this is good news.
Today, we can say that if nothing special happens, and I'm speaking large-scale events here that would have an effect, a negative effect on our insurance profitability. I mean, there are no signs of anything bad happening in the economy, in this environment, we are likely to deliver around 125%-100% in 2026 in terms of solvency. Now, speaking about our European peers, we have really done our research here. Many European peers, large companies are speaking about 180%, 185%. Their targets are different from what we would expect. Also, 2027, the debt from 2009 becomes mature, and this will be probably rolled out.
This is an instrument which you can also adjust a bit to your needs, but we don't know what the needs will be like now, because of the reorganization and the next steps to be taken. To conclude, let me tell you that, no matter what happens, this debate about solvency shouldn't have any effect on how PZU will meet. Its obligations related to the dividends, because this is what you can bring it down to, I think. Now, speaking about the market and PZU, we also have our targets here. I think that the potential of the market is a growth rate of 6%, more in non-motor than in motor insurance. Motor insurance is quite uncertain today.
As you can see in this chart, this is a very particular moment, the regulator has sent us a strong signal, and hopefully this message will be understood the right way. Some competitors were very aggressive last year. In press releases today, they say that they don't want to sell insurance at any price, and we will see whether this is actually true. Time will tell. For us, it's an opportunity for the prices to grow. This is already happening, if you have a look at the renewal ratio. In 2025, the renewal rate was poor because this was an extraordinary year. We hope that this will be fixed, and I think that we are on the right track to get better.
This is an important driver. It only takes a slight adjustment, and we really know that our exclusive agents are very profitable. This business is very profitable. Also, the inward reinsurance has reached an unprecedented scale, and this can be very meaningful for the P&L because our competitors can't scale up their business this way, and we do have it in our strategy and we're going to do it abroad. I hope that we will be able to grow faster year-over-year than the market, and according to our assumptions, the market should grow this year by 6%-7%. This is one thing. Of the extraordinary things about 2025, the renewals, our own agents, who are a very effective channel of sale for us and a very important one.
We also have to focus on the intermediaries. This is the second pillar of the market. This has changed a lot over the last years, and we want to regain our position here because our policy was not stable or predictable, and we had to face the consequences. This is my goal and the goal of my management. We have a great competitive advantage, which is our own agents, but at the same time, we want to build a very effective system of external distribution through multi-agencies, among other.
... ways. We are working on it, both on the technology, because we are implementing the front-end system, but we are also building a team that will work together with our partners closely, because they account for 50% of the market already, so we have to take that into account.
Andrzej Powierża , I represent the Citi Handlowy. I have two questions. You've said many times that last year was extraordinary. This one was also quite extraordinary because we had quite an impressive winter. I wonder if this anomaly, weather anomaly, can affect the results of PZU in Q1.
I'd like to remind you that this winter started in the previous year. Yes, it was an extraordinary winter. It started in December. It's important, not because of the snow, but because the snow kept falling, and it was falling at the end of December, and there were not that many claims. We did what PZU is best at. We behaved carefully, and we decided to wait and see if after Q1, we'll have a surge in the number of claims, and that part of those claims for losses suffered in December will be filed in January. This is something we took into account, and we prepared ourselves. I think that the market, in general, will report worse results for January. Of course, I cannot guarantee anything because we're talking about the insurance market, and the entire insurance market is based on uncertainty, on certain future events.
What we did at our end is that, is that we adopted a responsible long-term approach. We're not about muscle flexing or proving something to somebody, only to suffer the consequences of it and the rollercoaster in a quarter that would follow. We have approached the results of the extraordinary 2025 year with a pinch of salt. We are a market leader, and therefore, we need to behave responsibly. I echo Tomasz's position. This is the time of the year when we need to be careful and take responsible decisions. During the last meeting, there was a question about the Baltic States. Let me explain that the winter in Poland is different than in the Baltic States. One thing is the situation on the roads.
In Estonia, actually, this winter also has been extraordinary, because the so-called ice highways have been opened, namely, the cars are driving on ice on the sea among individual islands. We'll see what the final results for Q1 from the Baltic States are going to be. The conditions there were tougher than in Poland, we'll see how it is going to be reflected in our portfolio. This is something that we'll discuss when the results for the Q1 will become known.
Thank you. I have one more question. The internal restructuring of PZU and creating a holding is a complex endeavor, how much time will you need to adapt to the new legal regulations that are about to be adopted? The one that will allow you to do the restructuring.
Please, can you explain, what do you mean when you talk about restructuring? Yes, I'm talking about the whole procedure from A to Z, the process of creating the holding. Actually, just step one, sorry, not the one where the bank is involved
We're talking about a period that spans over 2 or 3 quarters from the moment of getting the green light. What we can do is that we can prepare ourselves, but without the new act entering into force, we have our hands tied. This means that we cannot take decisions, certain decisions, that might be misinterpreted before the legal provisions take effect. They might be, for instance, perceived as acting to the detriment of the company. What we can do is to prepare, to carry out stocktaking of all the agreements that have to be transferred to the new entity. We can analyze our systems, et cetera. What we cannot do is we cannot start to negotiate with large partners, technological partners, otherwise it might be interpreted as acting in bad faith.
Are there any other questions in the room? I can't see any, so maybe let us move to the questions from the internet. Trigon Brokerage House is asking for some explanations regarding the position of the competitors in non-motor sector.
Well, the situation is different in a non-motor and in corporate sectors. Actually, the competition has become fierce in Q4. The non-motor sector has its characteristics. The clients there are usually more loyal. We have more returning clients and more renewals. That's true, and I would like to add one remark to this. Please note that there is a very unique entity in our group. We are treating it as a unique distribution channel that has to have a given legal form under the existing provisions. This entity allows us to create incentives for our clients.
Don't get me wrong, the incentives mean that we are offering a good coverage for a good price, plus some advice on prevention, and some large entities are very interested in those incentives. We kind of tell them how they can improve their procedures in a way that will make them less prone to major economic damage, because they know that prevention is better than the cure. Like, no, hardly anyone really is looking forward to payments for business interruption. They would rather not have their business interrupted at all. Those types of customers, they work closely with us, and they also benefit from the surplus that is generated in our result. This is the competitive advantage that we have in the corporate sector that our competitors just don't have.
There's a question regarding investments also from Trigon.
There was a drop in the investment result in insurance sector. What is the run rate? What is the forecast regarding run rate for upcoming quarters?
This is a consequence of certain tactical decisions that concern the bonds, financial instruments, yields, et cetera. They had negative adjusted value. To make the best use of the circumstances in Q4, we decided to recognize those negative values.
... hoping that we will be able to report a higher return in future quarters. In 2025, the profitability of our portfolio was at 5.4%. The result was worse by PLN 300 million year-over-year. I can say that this result was not representative, and we need to think that this portfolio has a potential of 5% or more. What has been reported for Q4 is just not representative.
There is a question regarding expenses without the insurance services. Why the expenses were so high?
We had a large increase of expenses in non-insurance business. Also, please note the revenue line, especially in the health pillar. If you analyze them together, you'll see that there is some surplus.
This is how it is with our non-insurance operations, mainly health, investment funds a bit. This is typical for the health pillar in winter. Just in Q4, we tend to go and see the doctor more often. Seasonality, briefly. Now we're coming back to profitability and dividends. PKO Securities.
The question is as follows: the CEO has mentioned the attractive dividends, and can you give us some more information about it? Are you interested in timelines or in values?
Well, values, I guess. Okay, Tomasz, this was a nice attempt. Ladies and gentlemen, it's quite a complex process to issue the management board's recommendation on the dividend, and we have to wait a bit more for that. This also requires some consultations with other stakeholders.
As I've said, we can allow ourselves to be thinking about an attractive dividend, which I think is included in our 2027 strategy, and then I might have already said too much, Tomek, haven't I?
No.
There is another question about the 190%-200% of solvency targeted for 2026, if nothing bad happens. This is calculated already, according to the new regime?
Yes.
The last question here from Trigon. The effect of the 2027 changes on the equities.
I'm not going to say more than there is included in our strategy, the changes will be implemented, and there.
Given that there will be no other changes in parameters and the reorganization, the changes will not have a worse effect than more or less 40, rather 30% points versus the benchmark. If it was 240 before the change, with the new setting, it's going to be 200 plus.
There is a question about a bank in Ukraine. Would we be interested in buying a bank over there? This is a question from PKO Securities.
This is a contextual question. Well, we look into every investment opportunity. We are very opportunistic about it. This is also covered in our strategy, and this is how we are going to proceed. Our strongest focus now is the banks we already have here in Poland.
Another question from PKO Securities: What do you think about the proposal of one of the political parties for insurance companies to spend PLN 750 million each year to modernize the police force and the firefighters?
Now, already, insurance companies dedicate 10% for fire protection to upgrade the fire protection services, both the national service and the voluntary service. This would be my answer. The last comment from the same company is, congratulations on bringing forward the announcement date of your results. Yes, a big thank you goes to Tomek and his team for very hard extraordinarily hard work. Yes, for an extraordinary year. Thank you, Tomek, and thank you, everyone, for the operations of the group. It has been a tremendous challenge, and we closed the year very, very fast.
Once again, I would like to thank all my colleagues who have contributed. I can only sign up to your words, let me also thank all the people involved, all the auditors. Thank you. Any more questions in the room? Thank you, see you soon on the 14th of May. Thank you, have a nice day.