Insurance company financial management by optimising premium level: the case of Poland

Abstract

The article, which falls within the terms of reference of insurance risk analysis, presents research on the death risk regional differentiation and its influence on the level of insurance and social security premiums. The article is divided into four parts. The first one describes probability of death as a measure of calculated death risk and presents synthetic results of death probability estimates for individual Polish voivodships. In the second part net life insurance premiums calculated separately for individual voivodships and premiums calculated with the average death risk factor for the entire territory of Poland are compared. Part three discusses the effect of the regional premium and death risk differentiation method on financial management of insurance companies indicating the value of the insurance fund established. The said fund has been calculated on the basis of the method presented and without the application of the regional premium differentiation method. In conclusion, recommendations are made concerning the possible application of the regional premium differentiation by insurance companies