The Turkish insurance sector targets 40% growth and bolsters macroeconomic stability under the strategic leadership of TSB.
The Turkish Insurance Association (TSB), led by President Uğur Gülen, continues to underscore the indispensable role of the insurance industry in the country’s economic framework. Speaking on a national television program, Gülen announced that the sector is targeting nearly 40% growth with an expected premium production of 1.2 trillion lira by 2025. He described insurance as an infrastructure that not only shields individuals from risks but also strengthens the macroeconomic resilience of Türkiye.
Highlighting the recent progress of Türkiye’s economic roadmap, Gülen emphasized the coordinated policies enacted under Vice President Cevdet Yılmaz and Treasury and Finance Minister Mehmet Şimşek. He pointed out that since May 2023, the government’s main goal has been inflation control and stabilization, both of which have been reinforced through the Medium-Term Program (MTP).
According to Gülen, a key element in the MTP discussions has been the budget deficit, primarily driven by massive post-earthquake expenditures following the Kahramanmaraş disaster. He mentioned that nearly $190 billion has been spent so far, with an additional $110 billion expected in the coming period. In addition, public healthcare spending remains a significant factor, covering approximately 80% of the 2.4 trillion lira healthcare budget in 2024.
The second crucial issue identified by Gülen is inflation, explaining that efforts to finance the budget deficit have indirectly fueled price increases. He also noted that agricultural risks such as drought and frost pose additional inflationary pressures. The third priority, according to him, involves creating sustainable long-term funding sources to support investment and growth.
Correcting a common misconception, Gülen underlined that “insurance is not merely about issuing policies; it is about ensuring the overall economic safety of a nation.” Referring to the economic losses exceeding $90 billion from the Kahramanmaraş earthquake, he warned that a potential Marmara earthquake could result in losses as high as $350–400 billion.
He further revealed that, while the current insurance market could cover about 10% of such a massive economic loss, the real capacity could reach up to 50% with proper sectoral development, signaling an enormous <u>growth potential worth billions of dollars</u>.
Touching on healthcare financing, Gülen pointed out that private health insurance currently accounts for only 3% of total expenditures. A moderate increase to 4% would transfer nearly $1 billion in costs from the public to the private sector, reducing the government’s fiscal pressure. He also emphasized the importance of the Supplementary Pension System as a consistent source of long-term capital. The current total savings within the Individual Pension System have surpassed 2 trillion lira, supporting national investment and financial stability.
Gülen evaluated the Central Bank’s recent 150 basis point rate cut positively, noting its favorable effects on the sector’s profitability, supported by strong cash reserves. As of the first nine months, return on equity across the life and non-life segments exceeded 45%, with the life and pension branches reaching over 65%.
Representing insurance, reinsurance, life, and pension companies under the TSB umbrella, Gülen confirmed a premium production target of 1.2 trillion lira by 2025, up from 800 billion lira a year earlier. Assuming inflation stabilizes around 30–31%, the industry anticipates achieving real growth between 8 and 9 percentage points. He expects this positive momentum to carry over into 2026, with continuous performance ahead of inflation.
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