Although the 2009 figures for the industry have not yet been published, premium production in the insurance industry did not grow in real terms, as in 2008, when the figures provided by the Association of Turkish Insurance and Reinsurance Companies (TSRÞB) are taken into account. According to figures released by the TSRÞB, total premiums rose by 5.6% year-onyear to TL 12.4 billion in 2009, a rate of growth about one percentage point lower than the announced inflation rate in our country for 2009, which was 6.5%. The impact of the global crisis was combined with the effects of competition, which is largely price-based and has been a feature of the Turkish insurance market for many years; this prevented the sector's premium production from growing in real terms in 2009, while at the same time precipitating a dramatic fall in technical profits. Moreover, the insured loss to be paid out in connection with the floods in the Marmara Region - especially Thrace and Istanbul - in September saddled the Turkish insurance market with the highest amounts to be paid out since the devastating earthquake in 1999. There were considerable losses paid out in connection with agricultural insurance policies, due to hail and frost incidents during the year. Again, negative results are expected in the motor and health branches.
Rising demand for Life Insurance
Demand in Life Insurance products increased in 2009; the primary cause for this was that these insurance policies offer products which secure the future, and people focus on the future in times of crisis. Turkish insurance market first started to attract foreign investor attention some years ago due to the massive potential in Turkey; this increased considerably in 2008 as the insurance sector reached its saturation point in developed countries. However, this trend did not continue in 2009, given the lack of companies suitable for purchase as well as the impact of the financial crisis.
Other important developments in the Turkish insurance sector in 2009:
The "Institute Cargo Clauses" dated January 1, 2009, and which also entered effect on January 1, 2009 was a key development in the Marine Insurance market during the year. To encourage switching to the Turkish flag, Motor Vehicles Tax was abolished, while the rates of Value Added Tax and Special Consumption Tax were cut.
Amendments were made to the Compulsory Earthquake Insurance Tariff and Instructions as of January 1, 2009.
The General Conditions for Travel Vehicle Support Insurance entered into effect after approval by the Undersecretariat of Turkish Treasury, on February 1, 2009.
The "Communiqué on Amendments to the Communiqué on Life Insurances" entered into effect on March 1, 2009.
The Amendment was made on the Compulsory Highway Transportation Liability Insurance Tariff and Intructions, which entered into effect on July 1, 2009.
The General Conditions for Fire Insurance and Additional Coverage Clauses were rearranged on September 1, 2009, which entered into effect after being approved by the Under secretariat of Turkish Treasury.
The Insurance Industry Training Center (SEGEM) provided "Technical Personnel Training" to insurance agents in various cities throughout Turkey from May, in line with Provisional Article 1 of the Insurance Agencies Regulation.
An Insurance Arbitration Committee was set up in accordance with Article 30 of Law no. 5684 with the aim of ensuring the easy and rapid settlement of disputes by arbitrators arising in connection with insurance contracts entered into between policyholders or those benefiting from insurance policies and insurance companies which are members of the system. The Committee initiated its operations in August.
|
