According to a survey into the perception of insurance in Turkey carried out by IDE Danişmanlık on behalf of the Association of Insurance and Reinsurance companies, we still have a long way to go!
Comparing the results of the 2012 survey with the previous one carried out in 2008, we can be pleased that more people are aware of insurance. But during the intervening four year period there has been no real increase in the percentage of the population who are insured.
Branches such as Personal Pension, life insurance, comprehensive motor insurance, health insurance, mandatory earthquake cover, household, and personal accident scored between 75% and 95% on the awareness scale. But less than half of the participants in the survey had heard of agricultural insurance, travel insurance and third-party liability.
One of the reasons often quoted for the huge potential for the insurance sector in Turkey to grow is the abysmally low penetration rate. When survey respondents were asked which types of insurance they possessed, the average number of policies per person was 2.01. When you consider that car insurance is mandatory for drivers, and earthquake insurance for home-owners, this is not exactly a stellar result!
Ever since I first became involved in the Turkish market in 1996 I have believed that, at some time, Turkey just has to catch up with the rest of Europe and we will begin to see much higher rates of penetration. But it seems we are still waiting for this day to dawn, and the sector is running hard just to stand still.
In 2008 76% of survey respondents had no private insurance. By 2012 this figure had fallen ….. but, to just 75%! Any statistician will tell you that this 1% change is probably within the margin of statistical error for such a survey.
This graph serves as a reminder how much work we have yet to do in order to insure just those who are from the ABC1 economic groups: