Fitch Ratings says in a newly-published comment that growth in the Turkish non-life insurance market is set to continue. The agency also expects a trend of improving profitability, although Turkey's exposure to earthquakes means that catastrophe risk may create volatility from year to year.

"The non-life insurance market in Turkey is being driven by an increasing awareness among the young Turkish population of the need for insurance," says Vanessa Flores, Associate Director in Fitch's Insurance team. "The sector is also benefiting from government initiatives for greater insurance protection against natural disasters, and the favourable domestic economy." The motor insurance sector, which accounts for half of total non-life premiums in Turkey, has been unprofitable for the past five years.

"Motor insurance pricing in Turkey is very competitive, with insurers focusing on volume at the expense of profit," says Flores. "Current pricing levels are unsustainable, and will have to rise, with profitability improving as a consequence." The comment "Turkish Non-Life Insurance: A Growing Market" is available at http://www.fitchratings.com.

Fitch is holding a Credit Briefing and Update on Turkey on 7 March 2013 in London. Senior analysts from Fitch's Sovereigns, Financial Institutions, Insurance and Corporate teams will be joined by external speakers to review and discuss the outlook for Turkey and Turkish institutions.

Source: bne