Insurance
From The Report: Turkey 2013
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The Turkish insurance sector is dominated by 25 multinational insurance companies, which held some 52% of the market in 2012. Gross insurance premiums grew 15.5% in nominal lira terms, or 8.8% in real terms, in 2012, and subscriber growth reached 18% that year. Protecting non-vehicular property accounted for 22% of the insurance market in 2012, with the largest segments fire (9%) and earthquake (4%) coverage, which are typically marketed together in “housing packages”. While in previous years the sector had largely followed the fortunes of the wider economy, in 2012 it maintained comparatively high growth rates, even as the overall economy slowed. The pensions segment even accelerated its growth, thanks to the strong performance of the capital markets and a new government incentive to match payments.
This chapter contains an interview with Mehmet Bostan, Chairman, Pension Monitoring Centre.

Articles from this Chapter

Overview

Leaping ahead: Following years of slow growth, 2012 sees big returns for the sector
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The country’s small insurance and pensions industry has long been valued for its potential to achieve sustained, above-par growth, and more than 20 multinational insurers have collectively spent over $3.5bn in Turkey since 2006 on acquisitions in the sector, in order to make sure that they did not miss out. In 2012 and early 2013, the industry began showing signs of finally delivering on that promise. While in previous years the insurance sector had largely followed the fortunes of the Turkish…

Interview

OBG talks to Mehmet Bostan, Chairman, Pension Monitoring Centre
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Interview: Mehmet Bostan What factors have contributed to the low domestic savings rate in Turkey, and how might this rate be increased by the new pension law? MEHMET BOSTAN: As has been widely documented, the savings rate in Turkey has remained low despite steady income growth in the middle class. The rate has actually dropped in recent years, from 24% in 1998 to 14% in 2010. There are many reasons for this trend. First, Turkish culture has become more consumption-oriented amid global economic…

Analysis

A merging movement: Consolidation comes calling
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Mergers and acquisitions (M&A) activity is heating up in Turkey’s insurance market, as liquid global financial markets encourage multinationals to bid for businesses that are growing faster than the overall economy. While pace of deals is unlikely to match that of 2006-08, when multinationals invested heavily in Turkey’s insurance market, the latest M&A wave is still expected to be impressive, with a number of large deals. For example, Yapı Kredi Sigorta, Turkey’s leading health insurer…

Analysis

Planning for pensions: New reforms have incentivised personal savings
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A landmark reform of Turkey’s private pensions sector is the centrepiece of the government’s plan to boost the country’s declining national savings rate. To draw more people into the pensions system, the government began matching 25% of personal contributions to private pensions, subject to certain limits, in early 2013. Early results indicate the incentive is working. Pensions firms added over 200,000 subscribers in the first two months of the year, according to government data. Though a small…