Page 7 - Turkinsurance Digital Magazine

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2017 brought several

new regulations to the

insurance market

Turkish insurance and pension market had a vibrant

year during 2017 in terms of legal regulations.
Auto enrollment system left its mark on the pension
market, and price cap system stamped the insurance

market with deep impacts.

During 2017, 13 circulars, 7 regulations, 5 sectoral announcements and 2 cabinet
decrees were issued for Turkish insurance and pension sector. In this section, we
have reviewed the legal regulations that closely concern the market and were dis-
cussed fiercely during 2017 with their impacts.

Automatic enrollment launched with the new year

The first regulation of the year was the “Regulation on the Procedures and Princi-
ples regarding the Automatic Enrollment of Employees in a Pension Plan Through
A Pension Contract Arranged by Employers” which came into force as of 1 Jan-
uary 2017. The new regulation was decided to be issued by the Cabinet in accord-
ance with the Bylaw 2 and Provisional Article 2 of the Law on Individual Pension
Savings and Investment System upon the note by the Undersecretariat of Treasury
dated 11 November 2016 and numbered 32665. The purpose of this regulation
was announced to be the determination of workplaces and employees to participate
in the pension plan, rate of employee contribution to be deducted from employees’
salaries and procedures and principles to regulate the system. The regulation ap-
plies to employees who are under the age of 45, and employers that employ people
who were under the age of 45 when they began working for that employer and after
the employer was included in the scope of the system. According to the regulation
that covers the public and private sectors, employees who were working for an
employer with 1000 or more employees joined the system as of 1 January. Em-
ployees working for an employer with 250 to 999 employees joined on 1 July 2017,
employees working for an employer with 50 to 99 employees joined on 1 January
2018. Employees of workplaces with 10 to 49 employees will join the system as of
1 July 2018, and employees working at workplaces with 5 to 9 employees will join
as of 1 January 2019. 3 percent of the base salaries of employees is deducted as
contribution amount.

Risk scope changes for agricultural insurance