Business and Investment
Opportunity in Turkish Health
Insurance: Analyses and
Forecasts to 2016
Industry Forecast Report
Reference code: IS0102MR
BRICdata Published: February 2012
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EXECUTIVE SUMMARY
1 Executive Summary
Market size and growth potential
In 2011, the Turkish health insurance category accounted for 12.5% of the overall Turkish insurance industry.
The Turkish health insurance category grew in written premium value from TRY1.2 billion (US$926.4 million) in
2007 to TRY1.9 billion (US$1.1 billion) in 2011, at a compound annual growth rate (CAGR) of 12.02% during the
review period (2007–2011). It is expected to continue growing at a CAGR of 10.89% during the forecast period
(2012–2016), to reach TRY3.2 billion (US$2.1 billion) in 2016. In addition, the number of Turkish health insurance
policies sold increased from 0.48 million in 2007 to 1.14 million in 2011. The number of new policies sold in the
health insurance category is projected to total 2.53 million policies in 2016.
Trends and drivers
The penetration of health insurance in Turkey is expected to increase from 0.16% of GDP in 2011 to 0.19% in
2016. In addition, the awareness about the benefits of health insurance products in Turkey significantly improved
during the review period. This was supported by government-run programs to encourage citizens to purchase
health insurance. In addition, Turkey’s population is becoming more health conscious and, as a consequence, is
actively seeking to purchase health insurance.
The Turkish healthcare industry is dominated by the Turkish Government. Mexico’s 2003–2013 Health
Transformation Program has already introduced several reforms in the healthcare industry and in the country’s
health insurance category. Most notably, the program led to the introduction of Universal Health Insurance, which
provides health insurance cover to all the citizens in the country, including foreign expatriates that live in Turkey.
The per capita annual disposable income in Turkey increased from US$7,351.4 in 2007 to US$7,448.7 in 2011.
This is expected to grow at a CAGR of 4.22% over the forecast period, to value US$9,123.7 in 2016. The rising
disposable income should benefit the health insurance category as more Turkish people will be able to afford
health insurance to provide improved healthcare services for their families.
Challenges
The generic drugs in Turkey have to be lower priced than their reference prices according to a government ruling.
For innovative drugs, the government requires massive discount price rates. Moreover, the drugs that are
provided in Turkey have an additional discount of 9.5% to the Social Security Institution. These government
rulings have had an adverse impact on the Turkish pharmaceutical companies, forcing many of them to downsize
their business operations.
The rural areas in Turkey contain 30% of the total population. As such, selling insurance products to these areas
is necessary for many health insurance companies to expand their operations. However, the awareness of the
benefits of private health insurance in these areas is low. There are also government-funded health insurance
schemes that cover people in rural areas, which make it difficult for companies to sell private health insurance. As
a result, health insurance companies will need to develop innovative, low-premium and high-quality healthcare
policies to successfully sell private health insurance policies in rural areas.
The lack of product innovations and inadequate distribution channel coverage are also constraining the growth of
health insurance in Turkey.
Competitive landscape
The Turkish health insurance category is dominated by public-sector companies, although the private-sector
companies have increased their market shares over the review period. The number of private insurance
companies is expected to increase in the country further with the proposed increase in the foreign direct
investment (FDI) limit for insurance. There were over 30 companies operating in the Turkish health insurance
category in 2010. Of these, the top six companies accounted for 60% of the total health insurance written
premiums. The German company Allianz was the largest health insurance company in Turkey, accounting for a
market share of 16.5% of health insurance premiums. Meanwhile, local companies Yapi Kredi and Anadolu
accounted for the second- and third-largest shares of 15.4% and 9.2% respectively in 2010. Several Turkish
insurance companies operate as subsidiaries of banks.
Distribution dynamics
There are four main distribution channels in Turkey: agencies, bancassurance, direct marketing and other
distribution channels. Agencies accounted for the largest share of 29.5% of Turkish health insurance written
premiums in 2011, followed closely by bancassurance with a share of 27.6%. However, it is expected that the
bancassurance channel will emerge as the largest distribution channel for health insurance sales over the
forecast period. The channel is expected to account for a share of 37.2% of health insurance written premiums in
Business and Investment Opportunity in Turkish Health Insurance: Analyses and Forecasts to 2016 Page 2
© BRICdata. This product is licensed and is not to be photocopied Published: February 2012
EXECUTIVE SUMMARY
2016. The main reason for the growth of bancassurance is the increasing number of banks that are selling health
insurance products in Turkey. For example, Is Bankasi and Yapi Kredi Bankasi are banks with health insurance
subsidiaries that are able to sell their subsidiaries health insurance products through their banking channels.
Business and Investment Opportunity in Turkish Health Insurance: Analyses and Forecasts to 2016 Page 3
© BRICdata. This product is licensed and is not to be photocopied Published: February 2012
TABLE OF CONTENTS
TABLE OF CONTENTS
1 Executive Summary ......................................................................................................................... 2
2 Turkish Health Insurance Attractiveness ........................................................................................ 8
2.1 The Turkish Healthcare Industry ......................................................................................................... 9
2.2 Turkish Health Insurance Market Size and Growth Potential ............................................................. 14
2.3 Turkish Health Insurance – Growth Potential .................................................................................... 18
2.4 Turkish Health Insurance – Benchmarking with BRIC Countries ....................................................... 19
3 Turkish Health Insurance Trends and Drivers .............................................................................. 20
3.1 Macroeconomic Fundamentals ......................................................................................................... 21
3.1.1 GDP growth ..................................................................................................................................... 21
3.1.2 Number of households ..................................................................................................................... 22
3.2 Business Trends and Drivers ............................................................................................................ 23
3.3 Consumer Drivers ............................................................................................................................ 24
3.4 Regulatory Framework ..................................................................................................................... 26
4 Competitive Landscape and Key Market Indicators ..................................................................... 27
4.1 Competitive Landscape .................................................................................................................... 28
4.2 Key Market Indicators....................................................................................................................... 30
4.2.1 Incurred loss .................................................................................................................................... 30
4.2.2 Loss ratio ......................................................................................................................................... 31
4.2.3 Investment type ................................................................................................................................ 32
4.2.4 Premium per capita .......................................................................................................................... 33
4.2.5 Paid claims....................................................................................................................................... 34
5 Product Strategy and Customer Segmentation ............................................................................ 35
5.1 Introduction ...................................................................................................................................... 35
5.2 Customer Targeting Strategy ............................................................................................................ 36
5.3 Current and Future Product Strategy ................................................................................................ 37
6 Distribution Channels .................................................................................................................... 38
6.1 Distribution Channel Market Dynamics ............................................................................................. 39
6.2 Distribution Channel Forecasts ......................................................................................................... 40
7 Challenges ...................................................................................................................................... 41
8 Company Profiles ........................................................................................................................... 42
8.1 Allianz Hayat ve Emeklilik AS ........................................................................................................... 42
8.2 Yapi Kredi Emeklilik AS .................................................................................................................... 42
8.3 Anadolu Hayat Emeklilik AS ............................................................................................................. 43
8.4 Mapfre Genel Yasam ....................................................................................................................... 43
8.5 Acibadem Saglik ve Hayat Sigorta AS .............................................................................................. 44
8.6 Groupama Sigorta ............................................................................................................................ 44
8.7 AXA Sigorta AS ................................................................................................................................ 45
8.8 Ergo Grubu Holdings AS .................................................................................................................. 45
9 Appendix ........................................................................................................................................ 46
9.1 About BRICdata ............................................................................................................................... 46
9.2 Methodology .................................................................................................................................... 47
9.3 Definitions ........................................................................................................................................ 48
Business and Investment Opportunity in Turkish H