Digital Insurance in Turkiye

I have been following the rapid developments in Digital Banking both in the World and in Turkey.

According to a news I read, the number of companies applying for a Digital Banking license in Turkey in the first months of 2023 reached 35.

What is Digital Banking? What kind of legislation does it have?

In the Regulation on the Operating Principles of Digital Banks and Service Model Banking published in the Official Gazette No. 31704 dated December 29, 2021;

“Digital bank: Credit institution that provides banking services through electronic banking services distribution channels instead of physical branches,”

It is defined as .

Digital Banks provide their services to their users over the internet, without having a physical branch.

The minimum paid-in capital amount required for the installation has been determined as 1 billion Turkish Liras, paid in cash, however, BRSA has the authority to increase this amount. Credit customers of digital banks can only consist of financial consumers and SMEs.

Some well-known Digital Banks serving abroad


Institutions that received digital banking operating permits in Turkey

-Hayat Katılım Bankası A.Ş.
-Kasa Katılım Bankası A.Ş.
-TOM. Participation Bank Inc.
-FUPS Bank A.Ş.
-Ziraat Dynamic

Enpara (QNB Finansbank) and CEPTETEB (Turkish Economy Bank) provide services through the licenses held by their traditional banks.

Although these companies have been given a digital banking license, there are no digital banks that have started operating yet. (As of 10.09.2023)

Based on the official definition of Digital Banking above, in international literature;

Digital insurance can be defined as “Online tools and platforms that use technology to improve internal operations while providing customers with efficient and personalized insurance services.”

Digital insurance solutions

It allows customers to carry out all their insurance transactions through digital processes.
It offers a user-friendly and personalized customer experience.
It simplifies policy administration, claims processing and customer service.
It increases operational efficiency with technology and data analytics, ensures faster transactions and reduces costs.
It helps insurance companies stay competitive by increasing customer engagement, brand loyalty and market share.

Digital insurance models offer speed, agility, easy accessibility and a user-friendly interface. This digitalization enables the creation and implementation of newer and better services.

Digital insurance service providers have the following differentiators:

-Customer first approach,
-An information source where potential customers can research and understand the brand without speaking to a representative.
-Insurance technology ecosystem where pricing, risk assessment and claims handling are done through open, connected software platforms,
-Insurance products that can be customized according to need
-Some companies operating in Digital Insurance in the world

Oscar Health,
Next Insurance,
Root Insurance,
Corvus Insurance.

Digital Insurance Examples in Turkey

As far as I can see, Turkcell Digital Sigorta A.Ş. It was established with a capital of 175 million TL.

Although Hepiyi Sigorta and, to some extent, Quick Sigorta, operating with their existing licenses, are companies that have made significant progress in this field, we are still at the beginning of the road in terms of both legislation and implementation.

I know that there are sub-applications in our large insurance companies, but there is no exact example that we can call Digital Insurance yet. (Note: If you have different projects, I would be happy if you share them with us in the comments.)

Benefits that digital insurance companies can obtain

Going Beyond Customer Expectations
Positive Consequences of Using Big Data
Reduced Costs
Better Employee Experiences
Leverage lower code capabilities instead of high Compute development costs
How to Implement Digital Insurance?

First of all, there is a need for legislation. Although we generally follow the legislation and practices in the digital world in our country, the legislation in this field abroad can be transferred in accordance with the conditions of our country, paving the way for digital insurance and providing guidance.

We can list the technological infrastructure that enables companies to be successful in digital insurance as follows:

Artificial intelligence
machine learning
internet of things
Big Data and Analytics
Software as a Service Features (SaaS)

Based on the definition of Digital Banking, SMEs and Individual customers as customer segments will be the target customers of Digital Insurance.

You may say that Digital Insurance as aggregator in Turkey was not as successful as it was once ambitious. This does not mean that it will not be successful eventually.

A process that starts today will provide an advantage over competitors. If we are not ready, an international company that is ready will eventually enter our market and be successful in this business.

Moreover, you can follow the development of classical insurance from the change in market shares in the last 10 years.

It is beneficial to try to adapt to the world and the age without resisting or wasting time.

Turkish Insurance Sector on the 100th Anniversary of the the Republic of Türkiye -5

Main Challenges and Opportunities

The year 2023 started with challenges for the insurance industry. The following are some highlights:

  1. The premiums rising due to high inflation and technical losses in the motor branch taken over from the previous years caused some customers with a low loss ratio to exit the insurance system.
  2. It is estimated that a sectoral loss of approximately 5 billion USD total cost of insurance and reinsurance companies) occurred in the SouthEast region of Turkey on 06 February 2023 due to the devastating earthquake damage that affected 11 cities, excluding the losses in the motor branch. (Aon, 2023)
  3. Due to the high MTPL loss/premium ratios, insurance companies are reluctant to issue policies despite many new regulations of the regulatory and supervisory authority (SEDDK), and there is no insurance company keen to issue TPML policies, which is a compulsory product.
  4. In addition, the earthquake that occurred on February 06, 2023 increased the concerns for the insurance sector players (specially reinsurers) about the consequences of the upcoming great Marmara Earthquake.
  5. There will be a shrinkage in both life and non-life premium production in the bancassurance channel due to bank loans falling and coming to a halt due to rising interest rates and contraction-oriented inflation reduction policies.

Main Opportunities:

1. In 2022, population for Turkey was 85.3 million persons. It increased from  1973 to 2022 growing at an average annual rate of 1.66%. (Source, September, 14th)

2. As of 2022, the median age of the Turkish population is 33.5 years (up from 28.3 in 2007).  (Source, September, 14th)

3. With the effect of rising interest rates, improvements are observed in the Financial Revenues item in P&L of 2023 compared to previous years.

4. Adjustments were made in line with inflation in earthquake/property  (fire) and health branch premiums. Except for MTPL in 2023, there will be a significant improvement in the technical profitability and bottom line figures of the sector in general.

5. Turkish GDP is approximately 1 Trillion US dollars. With insurance sector’s very low share in GDP (around 1,3%) when compared to the World figure (around 7%), the Turkish insurance industry still keeps its potential to grow.

6. Very well regulated legislation in line with European Union Legislation.

7. Huge potential for Digital Insurance. (i.e.: Almost 82% of the population are internet users)


Turkish Insurance Sector on the 100th Anniversary of the the Republic of Türkiye -4

Lines of Business Distribution

Lines of Business distribution for the last three years is given in Table 1.5. Sickness/health, motor own damage, motor liability, general damages and fire and natural disasters have shared since the last three years.  43% of  total non-life insurance premiums motor business, total of motor own damage and motor liability.

Table 1.5 Turkish Insurance Industry – Gross Premium Production per LoB

(Billion TL) 2019 % 2020 % 2021 %
Non-Life Total         57.442           100,0         68.152           100,0         87.599           100,0
Motor Liability            18.613                32,4            20.494                30,1            23.324                26,6
Motor              9.319                16,2            10.738                15,8            14.289                16,3
Fire & Natural Disasters              8.357                14,5            10.586                15,5            14.050                16,0
Health              8.300                14,4            10.096                14,8            13.078                14,9
General Damages              5.836                10,2              7.962                11,7            11.037                12,6
Casualty              2.369                 4,1              2.237                 3,3              2.443                 2,8
Public Liability              1.698                 3,0              2.190                 3,2              3.217                 3,7
Transport                922                 1,6              1.204                 1,8              1.844                 2,1
Other              2.027                 3,5              2.646                 3,9              4.315                 4,9
Life         11.359           14.431           17.768  

Source: SEDDK (2021). Annual Report About Insurance And Prıvate Pensıon Actıvıtıes Retreived from . December 10, 2022.

Turkish Insurance Sector on the 100th Anniversary of the the Republic of Türkiye -1


Turkish Insurance Industry Overview

Insurance sector, which has existed in our country since the end of the 19th century, is crucial for the economy and stable growth, with its economic value more than forty times the Gross National Product itself.

Insurance in Türkiye was initiated in 1872 by the representative offices of British insurance companies. After the British insurers, the French insurers also showed interest in Türkiye and in 1878 the first French company launched its operations. Further, insurance activities expanded with the entrance of insurance companies of foreign countries such as German, Italian and Swiss to the market. Although these companies provided required quaranties to the insured, they were operating completely unsupervised at that time due to the absence of laws envisaging the establishment of insurance companies and regulating insurance activities, or even a provision addressing this issue.

In 1893, the first domestic insurance company was established with the title of Ottoman Public Insurance Company. With the changes made in the laws in 1908 and 1914, foreign companies were tried to be controlled. With the law of 1914, foreign companies were required to provide collateral and pay taxes.

“Anatolian Turkish Insurance Joint Stock Company” was established by İş Bank, on April 1st, 1925 (Özbolat, 2010: 39). Following this important development, “National Reinsurance Company (Milli Re)” was established in 1929, and a local reinsurance monopoly started. (Uyar, S.,and Uyar,2012). Since then, the Turkish Insurance sector has practiced many laws and regulations. Industry lived through a tariff period in which prices were fixed, which would last until 1990. The first Insurance Law No. 5684, which is still in effect, was published in the Official Gazette dated 14 June 2007 and entered into force.

Due to the fact that our country is an earthquake zone, with the number of vehicles in traffic increasing rapidly, especially in big cities, the risk of accident increased so much that individuals cannot carry them, insurance applications go beyond being a guarantee of assets, and with the development of products and services for the sustainability of commercial activities such as credit and performance insurance, attractiveness of pension funds for the economic stability, increased the state and people’s sensitivity to insurance. The reflections of the harmonization laws enacted years before in the process of integration with the European Union on risk management, insurance and social security issues have also gained great importance.

The Turkish insurance industry shrank significantly as a result of the economic crisis in 2008, but started to recover as of 2009 and entered a period of high-rate real growth with the reduction of the effects of the crisis. Direct premium production in the sector increased by 15% in real terms in 2013, about eleven points above the GDP. The increase in premium production in 2013 is the highest rate recorded in the last five years. However, the sector showed 7.3% nominal growth in life and non-life total in 2014, and could not achieve real growth for the first time in years (SEDDK, 2008 to 2014). As Table 1.1 demonstrates, between 2015 and 2021 premiums in US dollars could not grow, and share in the World Insurance Market decreased from 0.25% to 0.15%. With its very low share in GDP (around 1,3%) when compared to the World figure (around 7%), the Turkish insurance industry still keeps its potential to grow.

The increase in consumer expectations and the widespread use of technology in the insurance sector created a more conscious customer profile. Companies adopted approaches that focus on new customer acquisition, customer retention and customer value in order to achieve sustainable profitability that accelerated the delivery of fast, practical and creative solutions that are suitable for changing consumer expectations compatible with the digital world (Kurtulmuş, 2018).

Table 1.1 Turkish Insurance Industry – Direct Premium Figures in US$

  2015 2016 2017 2018 2019 2020 2021
Mio US$              
Non-life Premium 9.800 11.400 10.200 9.000 9.244 8.765 8.645
Life Premium 1.400 1.600 1.900 1.400 1.689 2.039 1.881
Total Premium 11.100 13.100 12.100 10.500 10.933 10.804 10.526
Non-life Share (%) 88,29 87,02 84,30 85,71 84,55 81,13 82,13
Life Share (%) 12,61 12,21 15,70 13,33 15,15 18,87 17,87
Premium /GDP(%) 1,3 1,52 1,42 1,36 1,15 1,5 1,3
Premium Per Capita (US$) 141 164 149 128 131 128 124
Share in World Insurance Premium (%) 0,25 0,28 0,26 0,22 0,17 0,17 0,15

Source: SEDDK Annual Report About Insurance And Prıvate Pensıon Actıvıtıes (2015-2021). Retrieved from, December 10, 2022.

Which Insurance Company was Acquired, at What Price in Turkey?

There is a new excitement in the insurance sector with the acquisition of Yapı Kredi Sigorta A.Ş. by Allianz Sigorta A.Ş.

On the one hand, the discussions on Should one invest in this sector? Is it too late to invest? have surfaced again, while on the other hand, we have frequently started to hear rumours about insurance companies who are planning to sell / have started working on selling their operatiıons in Turkey.

So, I wanted to list the figures on insurance company acquisitions which are concentrated around the period 2006/2007.

Şİrket çarpan



  • Life and pension company acquisitions are not included.
  • EURO (EUR) as a currency has been taken into account as at annual average TL conversion rate in which the acquisition took place.
  • I have obtained the figures from several sources; if there is some information that I am not aware of and/or a different figure, I can make the correction when you share the related document/information.
  • The figures in the study are composed of the “initial acquisition prices” of the companies, and do not take into account additional share acquisitions which took place in some cases.
  • In the case of some insurance company acquisition values, their bank distribution agreements have also been effective. The durations and figures in these cases differ from each other.
  • I wıould like to thank Ali Demir for his contribution on this study.

“Bourne Theory” Stars Should Not Wear Iwc Pilot Top-Gun, Because It Is Broken

After I posted my article  “Do Not Buy Iwc Pilot Top-Gun Because It is Broken” in my personal blog, one of my readers gave me the name of an authorized person from Schaffhausen and we have started a discussion about my complaint on my broken Top-Gun seramique watch. I’d like to thank  him as he shows extra effort to solve my problem. But I think he will not be able to solve it.

In order to understand that it is not my fault but it is Iwc’s product’s defect he recommended me to give my broken watch again  to their service. This will be the second time that I will send it to service. First investigation had taken nearly two months and their comment about my broken watch was that “ the damage was due to an impact which is not covered by warranty.”

I am a white color, office worker, an insurance proffessional and I have more than10 watches and I use them in a circulation. Only Iwc Pilot Top-Gun with seramique parts was broken without any spesific incident.

One of my favorite movie series is Bourne Theory. And when I started to watch last Bourne movie which is “Bourne Legacy”, I saw a scene that schocked me. Last Bourne star was wearing  Iwc Pilot Top-Gun when he was on wild nature.

I learnt in my experience that Iwc Pilot Top-Gun can be broken even at office. How it may show resistance to mountains and hard natural environment?

Doesn’t it decrease the reality of the Bourne stars roles at the movie?

I’m Sorry

An old colleague reproached me the other day: We could not and will not be able to find the same working environment that we had together. We realized that, that was an exception, the working life is not like that in general, and we could not be happy after that company any longer, she said.

So, I decided to list the issues that I am sorry about and to apologize from my ex-colleagues for setting these as the company culture.

I’m sorry because:

-We managed the company through a committee that we established,

-I enabled information flow from top to bottom in such a way that there was no room for gossiping,

-I gathered all employees together and informed them even in hard times, including acquisition period,

-I sent e-mails to all employees once a month, as company CEO, informing them about the company’s financial standing and performance,

-We arranged feedback meetings with managers on a quarterly basis about what we did right or wrong,

-We never left any subject vague,

-We arranged “vision” meetings once a year where we provided information to all employees about what we did, what were the mistakes, what we plan to do the following year, etc. and then had a party where everybody had fun until the next morning,

-We arranged a reward ceremony once a month for employees who made positive contribution to the company,

-We distributed the performance targets to all employees and evaluated them based on the same criteria,

-I did not locate the CEO’s room on a separate floor, and never kept it close,

– I made motivation tour on floors and patted my colleagues on their backs everyday,

-We made it the company culture to interfere in whatever is not right and fight with it until it is corrected

-I had conversations with each and every employee on life,

-I showed to people that sometimes you should just leave, because nothing is more important than “working happy”,

-We encouraged conflicts to achieve best business results, and never allowed any other conflict,

– I never hesitated to put my signature under any decision,

-We always encouraged innovation with excitement and faith,

-I encouraged people to take responsibility at work, and once something is done, I always stood by them until the end,

-We tried to make office life attractive for the employees where they spend a majority of their daily life,

– We brought musicians to play on the floors on the Women’s Day,

-We transformed the working place into a place of sympathy and respect,

-I always gave the message “to stand together” to my colleagues,

-And for many things else that I can not remember now,

I’m sorry.

You get used to these things very quickly and start believing that every place and every time it is the same, but you can not easily find these things at other places and times.

The Bank that says “I’m in Digital Insurance too!”

We are observing with excitement the entry of one digital distribution channel after another into the world of digital insurance in the recent days.

Direct insurance companies, brokers, agencies, insurance portals. And now, a Bank has carried its insurance activities to the digital space.

Aktif Bank has launched a web site called 

Aktif Bank is a bank that makes successful use of alternative distribution channels in banking. Instead of increasing the number of its physical branches, they create successful applications of alternative distribution channel solutions.

They have now added “alternative insurance” to their differentiated approaches.

In the website;

      • The products are offered under the headings MTPL, Motor Own Damage, TCPI, Home, Personal Accident, Emergency Health, and Special Products for You.
      • The Customer Value Offer is very clear:

                                         -Best price,
                                        -Anytime, anywhere,
                                        -7/24 Customer Support,
                                        -Claim Support Service,

      • They work with 9 insurance companies.
      • As far as I could see, it was designed as an online web service only – they aim to provide service also through Post Offices and through different locations with the help of the Business Partnership Program.
      • The website is designed as a bright, easy to understand and one that requires little information exchange.

On the other hand;

    • The presentation stile that is favored by the digital world, such as animation or a sympathetic character that carries “humor”, was not used. It looks a little distant from the “in“s of the digital world at first glance.
    • It is a curious matter how they will bring together the current insurance legislation and the “Business Partnership” program. I hope they will be successful in this respect and contribute to the expansion of the insurance pie to the base.
    • “Neova Sigorta”, which is used as an example under the heading “How Do I Get Insured”, is not one of the insurance companies that is listed on the main page.
    • However, I believe they will be making many improvements in time as the site is brand new at the moment.

I wish all the success to Aktif Bank and the team who have opened a new page in insurance.

I may not have an objective view in this, but, I believe that is still number one among the alternatives in terms of reflecting the colours of the retail world and customer point of view into its processes.

Let’s see what innovations will come up in the digital world in the coming days.

It’s About Time – Insurance Direct

Before 2012 is over, and less than a year after my blog post titles “Is Insurance Direct Coming to Turkey?”, I found out that Aviva Sigorta made a silent entry into the direct market through its web site “Artiksirasende“.

  • The site is beautiful in terms of colour and design. The transactions are easily explained through animation, the widespread marketing tool of the internet world.
  • The expectations of internet users regarding “being rewarded however small” is being fulfilled.
  • They are trying to market motor own damage and MTPL policies together and those who buy motor own damage policy online will get a 5% discount if they also buy the MTPL policy online.

It’s brand new and there are areas still to be further developed.

Example: The system is still not a fast-flow process for the end-user. I believe that developments are needed especially in the proposal page by close monitoring of user experience.

My favourite feature: The freedom of the user to design the motor own damage policy according to his/her needs

What I wonder; whether the motor own damage policy content and price is different from that of what the agency sells.

However, in any case, I congratulate and wish all the luck to the management of Aviva Sigorta who have shown the courage of bringing Direct to Turkey in a real sense.

One company was going to lead the bringing of Insurance Direct to Turkey. I think that the other players will be faster and braver to head towards the direct market from now on.

It is best to investigate “how to become a part of this new world” for all the players – not trying in vain to stop the process.

Average Premium for Motor Own Damage and MTPL is Increasing

Today, on one of the economy channels; when they were discussing the Istanbul Stock Exchange performance, in contrast to many other sectors,

 •They mentioned that the insurance sector shares were negatively separating and thus falling.

 As an insurer, I was upset.

 Right after this, Mr. Erdem Başcı, the President of the Central Bank, mentioned in his speech;

 •They were about to finalize the sharing of credit ratings of customers with other institutions.

 Again, as an insurer, I was happy with this news.

Because, I know that the credit rating information is used very effectively in motor insurance pricing in many countries, especially the USA.

The market is producing technical loss in motor insurance.

According to the 9-month results, the market has a technical loss of;

102.145.406 TL in motor own damage,

651.783.926 TL in MTPL.


I am observing a lot of positive development for the compensation of these losses. For example, I know that the risk selection and modelling of companies is based more and more on “detailed data”.

In order to see how these efforts are reflected in product prices, from the data of Turkish Insurance Association, I tried to extract the quarterly development of average prices (*) in motor own damage and MTPL between 2008 and 2012.

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(*Average Price= Independent Quarter Premium/Number of Policies)

Result: Average premium in Motor Own Damage and MTPL is increasing.