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The risk appetite is defined in PZU Group as the amount of risk taken in order to achieve business objectives and it is measured by the level of potential financial losses, decrease in the value of assets or an increase in the value of liabilities in a one-year period.
The risk appetite determines the maximum level of acceptable risk when setting individual partial risk limits and restrictions which, when exceeded, result in taking actions necessary to limit further risk growth.
In all insurance PZU Group companies, the process of determining the risk appetite and limits for individual categories of risk that is in line with the group process was implemented. The Management Board in each company determines the risk appetite, risk profile, and tolerance limits which reflect its strategic plans and objectives of the entire PZU Group. Such an attitude ensures appropriateness and efficiency of the risk management system in PZU Group and prevents risk acceptance at a level which could pose a threat to the financial stability of individual companies or the entire PZU Group. The Management Board is responsible for determining the appropriate risk level for every company, whereas the risk unit reviews the level of risk appetite once a year. All the activities are coordinated at the level of the Group.
Organizational structure of risk management system
