Turkey: Treasury strengthens solvency of insurance and private pension companies
Source: Middle East Insurance Review | Nov 2015
Turkey has tightened solvency requirements for insurance and private pension companies by increasing risk coefficients for reinsurance risks and excess premium increase risks.
The tightening has been effected through the Regulation on Measurement and Evaluation of Capital Adequacy for Insurance, Reinsurance and Private Pension Companies, issued by the Undersecretariat of the Treasury, noted Mr Muhsin Keskin, Partner of Esin Attorney Partnership. The regulation came into effect on 23 August 2015, except for the reinsurance risk calculation rules that will come into effect on 1 January 2016.
Under the regulation, insurance, reinsurance and private pension companies must maintain minimum capital against their current liabilities and risks. The solvency ratio is calculated by dividing the capital by the minimum required capital, and must be at least 1.00.