Hürriyet - Enjoying low penetration levels combined with favorable demographics alongside a fundamentally strong economy, Turkey’s insurance market has scored high in the first quarter, reaching 27 percent growth in premium production compared to a year earlier.
The figures announced by the Insurance Association of Turkey (TSB) revealed that insurers in Turkey have produced a premium total of TRY 6.5 billion (approx. USD 3.4 billion) compared to the TRY 5.1 billion generated in the same period of 2012. The breakdown of the impressive total shows that non-life categories constituted the majority with TRY 5.6 billion, while the remainder came from the sales of life insurance products.
Among non-life categories, the premium growth in compulsory traffic insurance products registered a rate of almost 50 percent while non-compulsory traffic insurance growth went up by 20 percent.
The increase in the profitability of insurers equaled the market’s growth rate, 27 percent, as profits reached TRY 162.6 million from TRY 128.7 million a year earlier.
More than half of Turkey’s insurance market is dominated by foreign investors. According to 2011 data, 28 of the 35 non-life insurers in Turkey have a foreign partner while 23 of the 28 life and pensioning firms are partly owned by foreigners.
Increasingly seen as a promising growth market in stark contrast to stagnated Europe, Turkey expects more foreign investors in its lucrative insurance market. The latest sizeable transaction in the market was made by German insurer Allianz last March, who acquired 93.9 percent shares of Yapi Kredi Sigorta, the insurance arm of Turkish-Italian partnered Yapi Kredi Bank, for EUR 684 million, significantly expanding its presence in the country.