Market Trends of Property & Casualty Insurance Industry
This section covers the major market trends shaping the Turkey Property & Casualty Insurance Market according to our research experts:
Non-Life insurance market is the high in the Turkish insurance industry:
Turkish insurers potentially significant exposure to catastrophe risk from earthquake events, many domestic insurers have limited net exposure to large property and engineering business as result of surrendering the bulk of commercial risk to reinsurers and the majority of residential property risks being absorbed by the presence of the government-backed Turkish Catastrophe Insurance Pool(TCIP). Many insurers are more focused on underwriting motor business, which accounted for almost 50% of total non-life premiums in 2018. Underperformance of MTPL portfolios has been driven principally by regulatory and legal changes in recent years.
Motor Vehicle Insurance contribution is high in Non-Life insurance segment:
In 2018, The largest share of total premium production is 29% from Motor vehicle Third party liability Insurance (MTPL). In compulsory traffic insurance, which constitutes 94.6% of the motor vehicles third party liability branch, premium production (direct + indirect), which was TRY 12,498 million in 2017, increased to TRY 15,302 million in 2018, increasing by 22.4% in current prices compared to the previous year. The direct premium production of the motor vehicles third party liability branch increased from TRY 10,921 million in 2017 to TRY 12,591 million in 2018, increasing by 15.3% in current prices (4.2% decrease in real terms) compared to the previous year. In 2018, the share of motor vehicle third party liability branch in total premium production increased from 28% to 29%. In terms of compulsory traffic insurance, the share of the industry’s total production in 2017, which was 26.8%, rose to 28% in 2018. When the number of compulsory traffic sub-branch policies is analyzed, the number of policies in force, which was 17.3 million at the end of 2017, increased by 2.1% as of the end of 2018 and reached 17.7 million. However, despite the 2.9% increase in the number of vehicles, the insurance rate decreased by 0.6 points compared to the end of 2017 and decreased to 77.5%.
