Aviva Launches Direct Auto in Poland

The UK's Aviva Group announced that its Polish operation, Commercial Union Poland, will enter the country's direct motor insurance market. Aviva noted that the "burgeoning growth in car ownership and the population's rapidly rising levels of disposable income," has created a situation that it can take advantage of.

"Car ownership has grown exponentially in Poland over the past 15 years," said the bulletin, "with 43 percent of the population now owning cars (a similar level to the UK), and the car insurance market - worth £1.9 billion [$3.76 billion] - is expected to double within the next 10 years."

Policies will be sold direct to customers via the telephone and Internet. Commercial Union Poland already provides home insurance, as well as its life and pensions business, which has more than three million customers in total.

The growth in demand for insurance cover is underpinned by "the influx of European vehicles onto the used car market" since Poland joined the European Union. The average age of used cars bought in Poland is decreasing, as sales of new cars increase. Aviva noted that "currently only 26 percent of those insured have comprehensive cover, or "casco" policies, compared with 80 percent in the UK, providing a major opportunity for insurers."

Aviva already sells direct auto in the UK, as well as Ireland and the Netherlands. It plans to "draw upon this expertise in launching our Polish operation."

Adam Uszpolewicz, Commercial Union Poland group chief executive, commented: "Direct motor insurance is a relatively new concept in Poland, but we predict the market will take off in much the same way it did in the UK in the early 1990s. More than half of UK motorists buy their policies direct today, and we expect that in ten years time a third of motor policies in Poland will be sold via phone or Internet. We already have a sizeable customer base in Poland and our brand enjoys high recognition, giving us a significant advantage in the market."

Source:insurancejournal.com