Is Insurance Market in Turkey Promising for Newcomers?

Turkey has been going through some tough difficulties such as global crisis, natural disasters and uprisings in the Middle East and North Africa recently.

Nevertheless it is noted by experts that the country has great growth potential with endless opportunities.

Insurance sector for instance in an emerging market such as Turkey is closely monitored by major players in the global market.

Although the insurance companies have incurred great losses due to global crisis, natural disasters and events in the Middle East and North Africa, they know they will make up for these losses in the long run.

It is estimated that aprroximately 70 percent of the Turkish insurance market is controlled by foreign companies.

The interesting thing is the average potential buyer is not very much aware of the function provided by an insurance policy. This means the market for retail buyers is expected to grow substantially, in the close future as potential consumers are – in a way – educated about the need for and benefits of such policies. This will add on top of the current market putting together huge opportunities for newcomers as well as existing players.

Currently, the ratio of Turkey’s insurance penetration  to gross domestic product corresponds to 1.3 percent showing what a great potential the market offers.

It is in fact reported by the Investment Promotion Agency of the Turkish Prime Ministry that Turkey has received a foreign direct investment of over $ 5 billion in the last five years.

The amount of premiums collected by insurance companies of Turkey totaled up to 141,6 billion Turkish liras last year (2010) – corresponding to 13,6 percent increase compared to previous term – which did not help the companies avoid losses, at the end of the day.

Editor
BUSINESS TURKEY TODAY