In Poland, an insurance company may operate only in one of three forms: a joint-stock company, a mutual insurance company (TUW), or a branch of a foreign insurance company from outside the EU. Each form requires separate authorization from the Polish Financial Supervision Authority (KNF), compliance with capital and organizational requirements, and strict observance of the Act on Insurance and Reinsurance Activity. Below are the specific requirements for each route.
Why consider insurance activity?
The insurance market is a large sector dominated by a relatively small group of insurers, but that does not prevent new players from entering it.
Demand is growing for insurance that goes beyond traditional categories such as health, life, motor and property insurance:
- Insurance for equipment: phones, bicycles and drones
- Protection against digital risks (cyber risks)
- Niche insurance products tailored to new consumption models
Growing demand creates opportunities for new entities, provided they meet the regulatory requirements.
Three permitted forms of insurance activity
Under the Act on Insurance and Reinsurance Activity, an insurer may operate only as:
- A joint-stock company, designated TU, ZU, TUiR or ZUiR
- A mutual insurance company (TUW), which insures only its members
- A branch of a foreign insurance company from a country outside the EU
What you cannot do: you cannot offer insurance through a limited liability company (sp. z o.o.) or as a sole trader. This is the first and absolute restriction.
A joint-stock company as an insurer
Restrictions on business activity
- A joint-stock company conducting insurance activity may not conduct any activity other than insurance or activity directly related to it. For example, it cannot also conduct investment activity.
- One entity sells insurance only from either Class I (life insurance) or Class II (personal and property insurance), not both at the same time.
Designation in the company name
A joint-stock insurer is required and exclusively entitled to use one of these expressions in its name:
- “insurance company” (TU)
- “insurance undertaking” (ZU)
- “insurance and reinsurance company” (TUiR)
- “insurance and reinsurance undertaking” (ZUiR)
Mutual insurance company (TUW): who is this form for?
A TUW is an insurer that covers its members on a mutual basis. This form may be suitable if a group of people wants to provide itself with insurance protection for a reasonable premium.
What distinguishes a TUW?
- It insures only its members.
- It must use the expression “mutual insurance company” (TUW) in its name.
- It may operate as a small TUW if it meets additional conditions.
Conditions for a small TUW
- Limited scope of activity, such as a small number of members or low insured sums
- Annual premiums do not exceed the equivalent of EUR 5 million
- No third-party liability insurance, credit repayment insurance or insurance guarantees
- The minimum guarantee fund may be zero
Branch of a foreign insurance company
This form applies to businesses operating an insurer abroad, particularly in another EU country, where the procedure for opening a branch in Poland is simplified.
What is a branch?
- A separate and organizationally independent part of business activity conducted outside the head office
- It does not conduct business in its own name: it operates within the financial and decision-making relationship with the main business
- It operates under Polish law and the main business’s articles of association, drawn up as a notarial deed
Name requirements
The branch must use the foreign business’s original name, with the legal form translated into Polish and the words “branch in Poland” added.
Scope of a branch’s activity
- The branch operates only within the scope of activity of the head-office insurer.
- It may, however, cover only selected areas, tailored to the specific features of the Polish market.
Requirements for the founders of an insurance company
Regardless of the chosen form, the founders must meet the following conditions:
- No criminal convictions: no founder may have a final conviction for an intentional offence.
- Documented financial resources corresponding to the planned organizational fund and the value of the share issue
- Approved basic own funds securing the minimum capital requirement, at least at the specified minimum
- Lawful source of capital: assets may not come from illegal or undisclosed sources or be connected with terrorist financing
Scope of activity: Class I and Class II
Before submitting an authorization application, you must specify the scope of activity precisely:
- Class I: life insurance, comprising 5 insurance groups
- Class II: other personal and property insurance, comprising 18 insurance groups
Specify the insurance groups in which you intend to operate. One insurer cannot combine Class I and Class II.
KNF authorization: procedure and documents
Who grants authorization?
The supervisory authority is the Polish Financial Supervision Authority (KNF). Authorization is required for a joint-stock company and a TUW.
Documents required for the application
- The company’s articles of association
- Business plan
- Certificate of no criminal record
- Balance sheet for solvency purposes
- Information about the sources of capital
Authorization for a branch of an insurer from another EU country
An insurance company from another EU Member State may operate in Poland if it has obtained the appropriate authorization in its home state.
Changes to the articles of association
Some amendments to the articles of association require prior KNF approval before registration. They include changes to:
- The company’s registered office and name
- Representation rules
- Management of assets and property
- The territorial and subject-matter scope of activity
Capital requirements: joint-stock company
The share capital of a joint-stock company conducting insurance activity may not be lower than the highest minimum guarantee fund required for the insurance groups covered by its authorization.
Minimum guarantee fund amounts (Class II)
| Insurance groups | Minimum guarantee fund |
|---|---|
| Some Class II groups | PLN equivalent of EUR 2,000,000 |
| Other Class II groups | PLN equivalent of EUR 3,000,000 |
Rules for paying up capital
- It must be covered exclusively by a cash contribution.
- It must be paid up in full before registration with the National Court Register (KRS).
- The funds may not come from a credit facility or loan and may not be encumbered.
- It is verified whether the payment comes from illegal or undisclosed sources.
Capital requirements: TUW and foreign branch
TUW
- Share capital may not be lower than the lower threshold of the minimum capital requirement for the insurance groups covered by the authorization.
- The minimum guarantee fund for a TUW is 75% of the amount applicable to a joint-stock company.
- The capital must be covered in full by cash contributions within 30 days of registration.
- The founders bear the capital costs. Repayment is possible only from profit while the supplementary capital is being built. Supplementary capital is part of equity intended to cover losses.
- Small TUWs may have a zero minimum guarantee fund if they meet the conditions described above.
Branch of a foreign business
- It must hold eligible own funds in Poland of at least the minimum capital requirement.
- Eligible basic own funds may not be lower than 50% of the lower threshold of the minimum capital requirement.
- Assets may not come from illegal sources or be connected with terrorist financing.
- The lower threshold of the capital requirement depends on the base amounts specified in the Act and the type of activity.
Requirements for members of management bodies
Members of an insurer’s management bodies, regardless of its form, must meet the following conditions:
- Full legal capacity
- Higher education
- No criminal record
- Documented knowledge of Polish, a frequent requirement
- Relevant professional experience or education in a relevant field
The details vary depending on the form of activity and the specific body. Check the requirements in the Act on Insurance and Reinsurance Activity.
KNF supervision of insurance companies
Insurance companies are financial institutions operating on principles similar to those of banks. They are subject to close state supervision, both financially and organizationally.
What does the KNF do?
- Monitors insurers’ activity
- Checks compliance with the law, including the valuation of assets and liabilities
- Conducts financial audits
- Enforces compliance with the Act on Insurance and Reinsurance Activity
KNF sanctions
- Fines and financial penalties for breaches of law
- In extreme cases, withdrawal of authorization to conduct insurance activity
KNF supervision protects the interests of insurance customers and the stability of the financial market.
Where to start: a summary of the steps
If you plan to open an insurance company, prepare for a multi-stage procedure. Follow these steps:
- Choose the form of activity: joint-stock company, TUW or branch, depending on scale, available capital and preferences
- Define the scope of activity: Class I or Class II, and the specific insurance groups
- Secure the capital required by law for the selected form
- Prepare the documents: articles of association, business plan, certificates and balance sheet
- Apply to the KNF for authorization to conduct insurance activity
- Appoint the management bodies and check the requirements for their members
- Register the entity with the KRS after authorization has been granted and the capital has been paid up
- Implement compliance procedures to ensure compliance with the rules from the first day of activity
Each form is subject to its own rules, and the regulatory requirements are demanding. If you need support with this process, write to us.
Frequently asked questions
What legal forms may an insurance company use in Poland? An insurance company in Poland may operate only in one of three forms: a joint-stock company, designated TU, ZU, TUiR or ZUiR; a mutual insurance company (TUW); or a branch of an insurance company from a country outside the EU. Each form requires separate KNF authorization, compliance with capital and organizational requirements, and compliance with the Act on Insurance and Reinsurance Activity.
Can an insurance company operate as a limited liability company or sole trader? No. Insurance activity may not be conducted in Poland through a limited liability company (sp. z o.o.) or a sole proprietorship. This is an absolute restriction under the Act on Insurance and Reinsurance Activity. If you plan to enter this market, you must plan from the outset to establish a joint-stock company, TUW or branch of a foreign insurance company.
What documents must be prepared for a KNF authorization application to conduct insurance activity? Prepare the company’s articles of association, a business plan, a certificate of no criminal record, a balance sheet for solvency purposes and information about the sources of capital. The completeness of these documents directly affects how quickly the application is considered, so it is worth preparing them carefully before submission.
What minimum capital is required to set up an insurance company as a joint-stock company or TUW? For a joint-stock company, share capital may not be lower than the highest minimum guarantee fund required for the selected insurance groups. For Class II, this is the PLN equivalent of EUR 2,000,000 or EUR 3,000,000, depending on the group. For a TUW, the minimum guarantee fund is 75% of the amount applicable to a joint-stock company, and the capital must be fully covered by cash contributions within 30 days of registration. The funds may not come from a credit facility or loan and may not be encumbered.
Where should I start if I want to open an insurance company in Poland, step by step? Start by choosing the form of activity: a joint-stock company, TUW or branch. Then define the scope, Class I or Class II, and the specific insurance groups. Next, secure the capital required by law, prepare the documents (articles of association, business plan, certificates and balance sheet), apply to the KNF, appoint management bodies that meet the statutory requirements, register the entity with the KRS after authorization has been granted, and implement compliance procedures from the first day of activity.
