Union of Chambers and Commodity Exchanges of Turkey

The opening speeches of the panel, which evaluated the problems, demands and development opportunities of the distribution channels and aimed to shed light on the future planning of the sector, were made by Hisarcıklıoğlu as well as Atilla Benli, President of the Insurance Association of Turkey (TSB) and V. Ali Ersoy, President of the Insurance and Private Pension Regulation and Supervision Agency (SEDDK).

TOBB President M. Rifat Hisarcıklıoğlu, in his speech, reminded that the Turkey International Insurance Summit was held by the TSB at the beginning of the week, and said, “A very auspicious work was also accomplished in this Summit. A memorandum of understanding was signed with the Insurance Associations of Azerbaijan, Kazakhstan, Kyrgyzstan and Uzbekistan for the establishment of a ‘Regional Insurance Council.’ I congratulate the President of the Insurance Association of Turkey, Mr. Atilla Benli, and his colleagues for this successful organization.”

Hisarcıklıoğlu mentioned that there was an important development in the insurance sector 2 years ago and reminded that the Insurance and Private Pension Regulation and Supervision Agency started its activities. The TOBB President said, “Although it coincided with the pandemic period, it completed its institutional structuring very quickly. By taking accurate and courageous decisions on the protection of the rights and interests of citizens, our country has carried out successful works for the development of the insurance sector. I would also like to express my gratitude to the Board Members and the employees of the Institution in the person of Mr. Ali Ersoy, Deputy Chairman, for all these valuable works.”

- “We should increase agency effectiveness in PPS and life insurance as soon as possible”

TOBB President M. Rifat Hisarcıklıoğlu said: “The size of funds in the Private Pension System has exceeded 244 billion TL. This is a significant achievement of the public and private pension companies. In 2021, premium production in the non-life branch amounted to 87.5 billion liras. Approximately 70% of this production was carried out by agents and brokers. In the life branch, premium production was 17.7 billion liras. However, this figure is far below its potential. Only 11% of this production was carried out by our agents. In Germany, the share of insurance agents in life insurance is around 50%. Therefore, for the development of life insurance in our country, we must channel insurance agencies into this area as well. We should increase agency effectiveness in PPS and life insurance as soon as possible. The share of agencies in the production of traffic and automobile insurance, which is the most widely used insurance product in our country, is over 80%. The share of agents in Fire Insurances is over 40% and in health and transportation insurances is over 50%. So, how do agents capture these production rates? Because agencies are the most widespread distribution channel geographically and numerically. Because agencies offer insurance products that best suit the needs of their customers. Because agencies inform their customers fully and accurately. It offers 24/7 service to its customers. In addition, the contribution of insurance agencies to insurance companies is also huge. Agencies ensure geographical diversity in the insurance market, delivering insurance policies to all socio-economic groups of society. For all these reasons, we must support insurance agencies, which are of great importance in ensuring the development and continuity of our country's insurance.”

- We should develop alternative sales methods, not alternative sales channels

Pointing out that there is a misunderstood concept in the sector, Hisarcıklıoğlu reminded that, “We need to develop alternative sales channels to grow the market. Distribution channels are clear in the Insurance Law. There is no need for another distribution channel. We need to develop alternative sales methods, new business models, not alternative sales channels, but through our existing agencies.

Digitalization should be used for the development of existing sales channels. Unfair competition and practices between agents and brokers should be prevented and cooperation opportunities should be developed in special projects in these professional groups. Agencies should be provided with the opportunity to benefit from developing technologies in marketing and management processes.”

- For the development of our agencies, they also need to be supported financially

Hisarcıklıoğlu explained that as TOBB, in cooperation with the Insurance Association of Turkey, they are preparing a new training program in order to increase the professional knowledge and competence of the agencies, and said, “A comprehensive training will be given online in cooperation with TOBB University of Economics and Technology and the Turkish Insurance Institute Foundation. This training will be open to all agency officials and employees who desire to be registered on the ledger. As TOBB and TSB, we will meet a very large part of the education budget. As TOBB, we say the best investment is the investment in education. For the development and institutionalization of our agencies, they also need to be supported financially. Agencies in every province I visit ask what our traffic commissions? That call, which we made at last year's meeting, was partially answered. Agent commissions on pool policies have been increased. We thank you for your positive approach in this regard. However, it is not enough. For all vehicles in traffic insurance, the agency commission should be increased.

Recently, there have been important developments for our country's insurance. The Regulation on the Sale of Distance Insurances, which caused controversy in the sector, was abolished. A new Regulation has been published. Fortunately, the concerns of our agents here have been addressed. General Conditions of Traffic Insurance were revised. Traffic Insurance transaction fee and coverage limits have been increased. The state contribution in the PPS was increased to 30%. Insurance Fair was held for the first time in our country. It was a very successful event in terms of the number of participants and the effectiveness of the program. The Executive Committee of Insurance Agencies of our Association also played an active role in all of these processes. Especially in the completion of the Insurance Fair in such a beautiful way, our Executive Committee has contributed a lot. I, who was instrumental in organizing this fair; I would like to express my gratitude to our Executive Committee Chairman Levent, our Executive Committee Vice President who is the organizer of the fair, and also to our Antalya CCI Council President Mr. Süleyman, TOBB-SAİK members and our Sector Council. I hope that this fair will become traditional and carry our country's insurance sector to further points.”