Turkey: Insurance Sector In Turkey

The economic slowdown and uncertainty in 2013 and 2014 had a negative effect on the global insurance sector. As a result, the total global premium volume increased at a rate of only 1.4% to USD 4,641 billion in 2013.1 Contrary to the general slowdown in the global insurance sector, the Turkish insurance sector is still in a steady growth and is offering opportunities to foreign investors.

According to the Undersecretariat of Treasury (the "Treasury"), the Turkish insurance and individual pension markets achieved a significant growth, with a TRY 24.2 billion (EUR 8.5 billion) gross premium volume through an increase of 21.8% in 2013.2 Life insurance premiums increased by 18.1%, while non-life insurance premiums increased by 14.5% in real terms. Insurance and pension companies issued in total 67,013,959 policies in 2013. The number of total valid policies issued in 2013 increased by 11.43%, thanks to a remarkable increase in the number of new policies issued in the life branch.

Three-quarters of Turkish insurance companies are now either foreign-owned or partnered. This shows that the Turkish insurance sector is a profitable target for investment by foreign companies. In 2013, German insurance company Allianz acquired Turkish insurance company Yapı Kredi Sigorta for TRY 1.6 billion (approximately USD 743 million). This was one of the most sizeable international transactions in Turkey's insurance sector in recent years. Also in 2013, the Malaysian sovereign wealth fund took over Acıbadem Sigorta for approximately USD 250 million.

I. Insurance Companies in Turkey

As of the end of 2013, there were 61 active insurance, pension and reinsurance companies operating in Turkey. Below is a breakdown of these companies3.

II. Competent Governing Authorities

The supervisory and regulatory authority for the insurance sector in Turkey is the Treasury. Certain transactions of insurance companies are subject to the Treasury's approval (e.g. mergers and acquisitions, portfolio transfers or share transfers).

All insurance and reinsurance companies must apply to the Treasury to obtain an operating license for each insurance product they would like to introduce, within one year following their establishment. Insurance companies can operate either in life insurance (and pension) or non-life insurance branches, while reinsurance companies are not subject to this restriction. Reinsurance companies can operate in both life and non-life insurance branches. A foreign insurer that does not hold a license as an insurance company cannot underwrite/sell insurance policies.

The Insurance Association of Turkey (Türkiye Sigorta, Reasürans ve Emeklilik Şirketleri Birliği) is a specialist, non-governmental institution established by law. All local and foreign insurance, reinsurance and pension companies operating in Turkey must be a member of this association. The main objective of the Insurance Association of Turkey is to conduct all research, training and all activities concerning the operating of insurance and pension activities and to coordinate insurers, as a neutral and reliable authority.4

III. Insurance Legislation

The primary piece of legislation governing the insurance sector is the Insurance Law.5 The Insurance Law entered into force in 2007 together with its secondary legislation and brought significant changes to the insurance sector. The Insurance Law governs, among others, the establishment, management, operations, supervision and audit of insurance/reinsurance companies, agencies and brokers operating in Turkey. In addition to the Insurance Law, the Turkish Commercial Code6 (the "TCC") also provides further insurance provisions.

A new legislation regarding a 25% state contribution as an incentive to encourage savings in private pensions, entered into force on 1 January 2013.7 This incentive generated a significant expansion in the pensions sector. This resulted in a major opportunity for insurers. In 2013, the number of participants in private pensions increased by 33% and reached approximately 4.2 million8.

The first half of 2014 was very productive for the insurance sector. Several new regulations were introduced and some important regulations were amended.

(i) Insurance Agencies Regulation9

The new Insurance Agencies Regulation replaced the former regulation in April 2014. The aim of the new Regulation is to clarify insurance agency activities and to provide protective provisions for both parties of insurance agency relations, by way of institutionalising agency systems based on essential principles. Following the enactment of the new Regulation, Circular No. 2014/8 on Implementation of the Insurance Agencies Regulation dated 22 May 2014 was also issued by the Treasury, to regulate the implementation rules. The main novelties brought by the new Regulation and the Circular are as follows:

  • Before the enactment of the Regulation leasing, factoring and financing companies were allowed to operate as insurance agencies. Following the enactment, these companies are now required to incorporate a separate company to provide insurance agency services. Active leasing, factoring and financing companies providing insurance agency services must comply with this requirement until 30 April 2015.
  • The minimum paid-in capital requirement for the incorporation of an insurance agency was increased to TRY 50,000 (this criteria is not applicable to active insurance companies). If an insurance agent will provide its agency services through branch offices, the minimum capital requirement is TRY 300,000, together with a minimum capital requirement of TRY 25,000 for each branch office. Furthermore, at least 50% of the paid-in capital must consist of cash or cash convertible investment instruments.
  • Similar with the former regulation, "technical personnel" must fulfil certain criteria, as a novelty. The technical personnel must attend training programs organized by the Insurance Education Center (SEGEM) and obtain a license, following the courses.
  • Agency agreements must include certain mandatory provisions (e.g. identification of parties, term, renewal and termination clauses).

The Regulation sets forth an adaptation period of six months for active insurance agencies. However, this period was then found insufficient and for this reason, criticised by market players. This period was extended to 30 April 2015 for certain provisions (e.g. provisions regarding financial lease and financing companies, agency agreements, technical personnel, branch offices).

(ii) Regulation on Activities to be Considered as Insurance Activities, Insurance Policies Concluded in Favour of Customers and Distance Sale of Insurance Policies (the "Regulation on Insurance Activities")10


The Regulation on Insurance Activities entered into force to clarify the definitions and rules for (i) the scope of insurance activities; (ii) insurance policies concluded in favour of a customer; and (iii) distance sale of insurance policies. The main novelties brought by the Regulation on Insurance Agencies are as follows:

  • Insurance companies are not allowed to conduct any activities other than insurance or insurance related activities. Service agreements and subscription agreements cannot be considered as insurance agreements.
  • If a policy is concluded in favour of a customer (as beneficiary), the insurer must provide a copy of the insurance policy to the customer.
  • In addition to the Turkish Consumer Protection Law, which was recently enacted11, the Regulation on Insurance Activities also regulates insurance companies' obligations with respect to the organisation and technical infrastructure required for distance sale of insurance policies. It requires online notification and delivery of the insurance policy (submission of a policy in an electronic manner is permissible) in compliance with the respective provisions of the TCC.

IV. Conclusion

As an emerging market, the Turkish insurance sector is offering many opportunities to foreign investors. Particularly in recent years under the influence of new market players, the number of insurance companies and total gross premium volume have rapidly increased. We expect to see more foreign investors attracted by the Turkish insurance market with the implementation of the secondary legislation.


1 Sigma Report No.3/2014, World Insurance in 2013: steering towards recovery.

2 Annual Report on Insurance and Individual Pension Activities – 2013, issued by Undersecretariat of Treasury, Insurance Supervision Board.

3 Market Analysis Report – 2013, issued by Undersecretariat of Treasury, Insurance Supervision Board.

4. http://www.tsb.org.tr/about-us.aspx?pageID=919.

5 Law No. 5684, Published in the Official Gazette dated 14 June 2007, and numbered 26552.

6 Law No. 6102, Published in the Official Gazette dated 14 February 2011, and numbered 27846.

7 Law Amending on the Law on Individual Pension Savings and Investment Systems, Published in the Official Gazette dated 29 June 2012, and numbered 28338.

8 Annual Report on Insurance and Individual Pension Activities – 2013, issued by Undersecretariat of Treasury, Insurance Supervision Board.

9 Published in the Official Gazette dated 22 April 2014, and numbered 28980.

10 Published in the Official Gazette dated 25 April 2014, and numbered 28982.

11 Law No. 6502, Published in the Official Gazette dated 28 November 2013, and numbered 28835.

© Kolcuoğlu Demirkan Koçaklı Attorneys at Law 2015

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.