Page 8 - Turkinsurance Digital Magazine

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“Transformation Initiative from the Insurance

Association of Türkiye (TSB) in Life Insurance”

channels stand out as priority areas. In Financial Inclusion and New Products
addition, by increasing the promotion of With the introduction of investment-linked
supplementary coverages included in life insurance products through more than
insurance policies, the aim is to raise pol- 6,500 individual pension intermediaries
icyholders’ awareness of policy scope and operating in the sector, the aim is to make
increase the number of people benefiting investment funds accessible to broader seg-
from these coverages. ments of society. Over a 10-year period, an
additional fund capacity of TRY 2.5 trillion
The Importance of Credit-Linked Life (11.5 percent) is projected to be created.
The Insurance Association of Türkiye Insurance
(TSB) has shared with the public its com- Credit-linked life insurance products also An Aging Population and New
prehensive “Life Insurance Position Pa- play an important role in closing individu- Insurance Areas
per,” which will shape the development of als’ protection gaps. In Türkiye, 61 percent In Türkiye, the elderly population ratio is
life insurance. While presenting the current of the total protection provided by the life expected to reach 12.9 percent in 2030,
state of the sector, the study also offers insurance sector comes from credit-linked 16.3 percent in 2040, and 22.6 percent in
concrete policy recommendations for the life insurance products. Indeed, following 2060. In line with this demographic trans-
expansion and deepening of life insurance the February 6 Kahramanmaraş earth- formation, the importance of long-term
in Türkiye. Having achieved strong growth quakes, 80 percent of the TRY 1 billion in savings and protection products is increas-
momentum in recent years, the sector life insurance compensation paid out was ing, while the sector is expected to assume
reached a premium production volume of provided through credit-linked life insur- a complementary role in elderly care insur-
TRY 178.9 billion as of 2025, while pay- ance policies. In terms of the expected Is- ance.
ments made to policyholders amounted to tanbul earthquake, life insurance products
TRY 29.7 billion. During the same period, are of great importance. Of the total TRY Ahmet Yaşar: “Life Insurance Is a
the scale of financial protection provided 3 trillion death coverage provided to the Strategic Necessity for Türkiye”
reached TRY 8.5 trillion in death coverage Marmara Region, 54 percent comes from Ahmet Yaşar, President, Insurance Asso-
and TRY 5.7 trillion in disability coverage credit-linked life insurance products, while ciation of Türkiye (TSB), emphasized that
for 15.4 million policyholders.
these products also account for 56 percent life insurance is not merely an instrument
of the TRY 2 trillion disability coverage. of individual protection and stated:
Target to Double the Protection
Shield! A New Protection Area for Employees “Life insurance is not only a critical tool
Despite this progress, the share of life in- The Insurance Association of Türkiye for ensuring the financial security of in-
surance in the economy still remains be- (TSB) states that if tax and social security dividuals and families, but also one that
low the averages of developed countries. premium incentives are provided to em- complements the social security system
According to the Insurance Association of ployers and flexible coverage models are and contributes to channeling long-term
Türkiye (TSB), implementing the transfor- introduced, a financial protection shield savings into the economy.”
mation steps defined in the position paper worth TRY 250–300 billion could be cre-
would make it possible to increase premium ated under group life insurance policies, Drawing attention to the fact that Türkiye
production to the level of 2 percent of GDP particularly for employees in the lower- faces significant risks such as demographic
and double the financial protection provid- and middle-income segments. transformation, disaster risk, and increas-
ed to individuals and households. Doubling ing economic fluctuations, Yaşar noted
the protection shield is considered highly Protection for Children’s Future that the role of life insurance has become
important in strengthening the resilience Life insurance also holds particular im- even more important throughout this pro-
of households and individuals against chal- portance for children, who account for cess.
lenging conditions arising from economic, approximately 25 percent of Türkiye’s
social, and natural disaster-related risks.
population. According to 2024 data, more The position paper underlines that the de-
than 345,000 children face the risk of eco- velopment of life insurance is not merely
Product Diversification and Increased nomic hardship and interruption of their an area of sectoral growth, but also carries
Awareness education due to the loss of a parent. In strategic importance in terms of long-term
The report indicates a significant need for this context, expanding and promoting ed- fund accumulation, the deepening of cap-
transformation, as the current production ucation insurance products is being recom- ital markets, and strengthening economic
structure is largely based on credit-linked mended. It is stated that if only 5 percent resilience. The roadmap presented by the
products, while savings-oriented products of the child population—approximately 1 Insurance Association of Türkiye (TSB)
remain limited. In this context, the de- million children—were insured, additional aims to enable life insurance to reach
velopment of savings-oriented products, financial protection amounting to nearly broader segments of society and assume a
the acceleration of digitalization, and the TRY 4 trillion could be provided. stronger role within the economy.
strengthening of alternative distribution