TURKISH INSURANCE MARKET & Motor Third Party Liability ...€¦ · 4 Company employees 19.353 More...
Transcript of TURKISH INSURANCE MARKET & Motor Third Party Liability ...€¦ · 4 Company employees 19.353 More...
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TURKISH INSURANCE MARKET &Motor Third Party Liability – Traffic- Insurance
23 June 2016
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TURKISH INSURANCE MARKET: AN OVERVIEW
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As of today;
37Non Life
1 Reinsurance
4 Life
19 Life and Pension
A total of 61 companies are actively operating
Number of Insurance Companies
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Company employees 19.353
75.000employedMore than
Brokers 119Loss adjusters 1 305
Agents 15 587
Number of employees
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Prim Üretimi 2010 – 2015
Increase in total premium
production between
2010-2015 is % 41 (in
terms of USD)
Premium Production
2010-2015 Premium Production, Billion USD41%
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Size of Private Pension Funds in Turkey
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Total Assets of Insurance Companies 2010-2015 (Billion Dollars)
23,424,3
28,2 32,8
33,9
32,6
0,0
5,0
10,0
15,0
20,0
25,0
30,0
35,0
40,0
2010 2011 2012 2013 2014 2015
Asse
ts (b
illion
dolla
rs)
Assets
Assets
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%Foreign players in the market:• Reflecting trust into the Turkish market • Transfering global practices into the
local market• Enabling insureds to benefit from
international novelties and developments
Foreign Capital in the Market
Share of foreign capital in total paid-up capital
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Prim Üretimi Dağılımı (2015)
GWP broken down by branches
TSB, 2015
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Sektör Prim Üretimi (Milyar TL)
A Promising Market:Rapid growth rate
10
2011-2015 % 80
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Claim Ratios of the Main Lines Of Business
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BRANCHES LOSS RATIOTRAFFIC 138%OWN DAMAGE 72%FIRE 40%HEALTH 76%PA 19%TOTAL 74%
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Equity and Return on Balance Sheet – Non life Companies
Balance Sheet Loss
Source: TSB
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MOTOR THIRD PARTY LIABILITY (MTPL) INSURANCE
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General Data
• The number of recorded vehicles was 19.793.995 by October 2015.
• The number of traffic insurance was 15.931.357 by the end of October 2015
• Insurance penetration was %80.48.
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General Data
According to the Turkish Statistical Institute’s data;In 2014, there happened 1.199.010 accidents,1.030.498 of them
was material damages, 3.524 individuals lost their lives,
285.059 individuals were bodily injured.
The number of official reports of accidents increased from491.030 in 2008 to 840.749 in 2014.
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Growth in MTPL
The number of MTPL policies and premium production displayed an increasing trend annualy in the past decade
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Share of MTPL in non-life branch
Share of MTPL in non-life branch has reached to 25 % in 2015
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MTPL25%
Own damage20 %
OTHERS26 %
Sickness-Health13%Fire and
Allied Perils16%
Source: TSB
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Loss in MTPL
In the last decade, companies reported loss in MTPL for each and every single period
Total amount of loss: 2.6 billion USD (7 billion TL)
Source: TSB
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REASONS MAKING LOSS IN MTPL
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Reasons for making loss in MTPL branch
Average Frequency(%)
Average Premium(€) Loss Ratio (%)
Combined Ratio(%)
Turkey(2015/9) 9% 105 %133 %163
EU(2013) 6% 230 %80 %103
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Source: Insurance Europe
Reason for making loss in MTPL branchTurkey-EU: A comparison of average premiums
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Reasons for making loss in MTPLTurkey-EU MTPL Claims Frequency
Source: Insurance Europe
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Reasons for making loss in MTPL Turkey-EU Comparison 2013
Avg. Freq. (%) Avg. Prem. (€)
Turkey 9% 110
EU 6% 230
Turkey: One of the lowest average premiums
and the highest frequency
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In the last 4 years, average bodily injury claims increased 311% and material damage claims increased 36% while average MTPL insurance
premium increased 54%
Reasons for making Loss in MTPLAn Increase in Loss Ratio
Source: TSB, SBM
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Reasons making loss in MTPL
Coverages within the scope of MTPL are: • Material Damage Coverage• Health Expenses Coverage• Permanent Disability and • Loss of Support (Death) Coverage
Varying interpretations due to lack of clarity in the definitions and coverages of the indemnities provided under MTPL
Lack of a standard calculation method
Retroactive court decisions
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Reasons for making loss MTPLShare of Bodily Injury Claims in Total Incurred Claims
Share of bodily injury claims has rapidly increased in total sums paid
Source: TSB
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TARRIFF SYSTEM OF MTPL INSURANCE IN TURKEY & THE IMPORTANCE OF FREE TARRIFF SYSTEM
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Importance of Free Tariff System
Motor Third Party Liability Insurance provides driving safety to prevent traffic accidents by deterrent effect of Premium increase.
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Sample of operators who benefited from the latest intervention into the tariff system:
TYPE OF VEHICLES* FREQUENCY
2 and more 3 and more 4 and more TRUCK 6.960 1.988 684PICKUP TRUCK 7.155 969 187MINIBUS (10-17 SEAT) 2.401 547 150BUS (18-30 SEAT) 1.393 329 100BUS (31 AND MORE SEAT) 706 100 21TAXI 518 82 16TOTAL 19.133 4.015 1.158*: In 2015, renewed policy of damaged group frequency.
Importance of Free TariffImplementation of Maximum Premium
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Type of Vehicles
2015 number of
damage2014 number of damage
2013 number of damage
2012 number of damage
2015 Premium
PriceTRUCK 1 13 9 6 5.940TRUCK 3 7 7 6 7.605TRUCK 2 1 2 3 4.860TRUCK 1 8 4 4 5.940TRUCK 2 4 8 3 7.605TRUCK 1 3 3 6 11.858TRUCK 2 3 2 2 7.605TRUCK 2 2 8 2 1.512PICKUP TRUCK 2 2 2 2 3.930TRUCK 2 4 2 2 5.940TRUCK 3 6 3 2 7.475TRUCK 1 1 6 3 6.882TRUCK 1 4 6 1 7.475PICKUP TRUCK 1 1 1 1 2.500TRUCK 3 5 5 2 9.800TRUCK 1 6 1 4 5.940PICKUP TRUCK 3 2 2 3 3.930TRUCK 1 2 2 2 7.069TRUCK 2 1 1 1 5.031TRUCK 3 7 2 2 7.475
Importance of Free Tariff SystemImplementation of Maximum Premium
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DISTRIBUTION CHANNEL IN TRAFFIC BRANCH& DIGITALISATION
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Dağıtım Kanalları (2015)
Agents63%
Banks15 %Brokers
13%
Other2%
Companies7%
Banks79%
Brokers1%
Other2%
Agents9%
Companies9%
Non-life Life
Distribution Channels by GWP
TSB, 2015
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Earned Premium of Distribution Chanels of Motor Own Damage and MTPL (2015, End of year)
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WOULD DIGITAL DISTRIBUTION CHANNEL REPLACE AGENCY?
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We Have to Use Digital Channels!
Turkey
Source: US Census Bureau, InternetWorldStats, Facebook, ITU
78,741,053
Total Population Urban Rural
35.990.932 INTERNET USERS
36.000.000
Facebook Users
68.000.000
MOBILE ACCOUNTS
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Information Channels
50
45
40
29
22
13
11
7
TV adds
İntermediaries
From Acquaintanceship
Banks
Newspaper/magazine adds
Customer representative
Websites of insurance companies
Call centers of insurancecompanies
% 68 intermediaries% 27 branch offices of banks
Information Channels Purchasing Channels
Kaynak: IPSOS Sigorta/BES Segmentasyon Araştırması 2015
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Digital Distribution Platforms in Turkey
•Online distribution channels are developing in Turkey in the past years•However, people use digital platforms to take information and to compare prices• Only 6% of people who consider having insurance, actually purchase insurance through digital platforms
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Kaynak: IPSOS Sigorta/BES Segmentasyon Araştırması 2015
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Digital Distribution Platforms in Turkey
Buy motor insurance only in two minutes A click away; most
convenient quotes from 15 insurance companies
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THANK YOU...