1. Undersecretariat of Treasury Directorate General of Insurance Recent Developments in The Turkish Insurance Sector Dr. Ahmet GENÇ Director General 3 October 2013

2. Presentation Plan - General Outlook - Regulatory reforms and new Institutions - Main Achievements

3. General Outlook 31/12/2012 Number of Companies59 - Insurance58 - Non-Life35 - Life6 - Pension and Life17 - Reinsurance - ~100 Broker, 15.000 Agents, 16.000 Pension intermediaries 1

4. General Outlook Insurance Premiums 20022.42619,61 20033.31636,57 20044.65659,52 20055.82925,19 20066.71315,15 20078.35924,52 20089.0618,40 20097.900-12,81 20109.41819,21 201110.2288,61 201211.0628,15 36 47 65 80 91 118 127 109 128 137 146 Per c.p. $ PREM./GDP 1,37% (30.06.2012) 1,45% (31.12.2013 est.)

5. General Outlook Branches TL Land Vehicles4.533.997.871 Health2.227.161.383 Public Liability420.117.770 Fire and Natural Disaster2.645.852.935 General Damages1.743.774.327 Credit74.072.355 Land Vehicles Liability3.937.605.695 Life2.714.282.254 Other1.531.824.052 Total19.828.688.642

6. Insurance Law No. 5684 - 2007 New Rules: - Market entry rules - Technical rules (technical reserves, solvency, reporting, accounting etc.) - Market leaving rules (liquidation, intervention etc.) - Intermediaries (registration, monitoring) - Other players New Institutions: - Insurance Agents Executive Committee (TOBB) - Insurance Loss Adjusters Executive Committee (TOBB) - Insurance Arbitration Commission - Insurance Training Centre - Insurance Information and Monitoring Center Regulatory Reforms and New Institutions

7. Main Regulatory Reforms in 2012 - Natural Disaster Insurance Law Introduced additional check-points for the earthquake insurance for dwellings, and expended the role of the TCIP to other natural disasters in case of a need - Changes in Private Pension System The tax deduction incentive was replaced by a state match of 25% for the contributions made by members of the system. This match is capped at the annual gross minimum wage. Regulatory Reforms and New Institutions

8. Financially strong insurance companies (no bankruptcy /failure after 2007) More disciplined insurance intermediation, particularly for insurance agents after the introduction of strict registration rules. The systematic problems arising from agents have been minimized. New arbitration system increased the consumer confidence to insurance. So far, more than 6000 case have been solved by the Insurance Arbitration Commission with an average 2 months time per case. Insurance training have been improved. More than 100.000 individuals (from insurance companies, intermediaries, banks, loss adjusters) have received basic insurance training via Insurance Training Center (SEGEM). Motor TPL policy transactions performed by insurance companies/agents on line real time, and information is stored in a centralized system (TRAMER). Traffic accidents declaration forms are monitored and cleared by a centralized system (TRAMER). Main Achievements

9. Earthquake insurance policies increased to 6 millions with an increase of 48% in one year. Penetration has increased to 35% with an increase of 10 percentage points. The number of participants in the individual pension system has increased to 3,8 from 3,2 in 2013. The new incentive sytem which came into effect as of January 2013 has already help to more than double the subscription rate. Main Achievements

10. Thank you.