Kaan ACUN
Deputy General Manager
MILLI Re

XPRIMM: How would you describe the progress made by your company last year?
Kaan ACUN:
MILLI Re maintained its key position in the Turkish Market and successfully met the reinsurance needs of market-players by providing proportional and non-proportional treaty capacity, as well as facultative support in all lines of business.

In 2016, MILLI Re participates in 19 proportional bouquets, leading 14 and its market share in respect of proportional treaties is 25%. MILLI Re also participates in Gross XL programs of 4 multinational cedants which do not have pro-rata treaties. MILLI Re does not have a leadership position in Cat XL programs, but kept a stable engagement of around 8.5% across 25 programs, including group programs of multinationals.

In spite of the prevailing soft market conditions and excess reinsurance capacity on a global scale along with the slowdown of the economic growth in emerging markets as well as price competition amongst primary market-players translating to lower premium income, thanks to our well-established relationships and commitment to render top-quality services to our clients, we continue to prudently expand our International Portfolio, which reached 26% of total premiums by the end of 2015. There was an 8.5% increase in the income from international operations.

In 2015, MILLI Re closed the year with a net profit of TL 130 million, yielding a return on equity of 15% for the year.

XPRIMM: Which are the main trends observed in the Turkish reinsurance market during the previous year?
K.A:
2016 renewals in the Proportional and Excess of Loss reinsurance agreements were concluded smoothly in the Turkish market. Rates of catastrophic agreements have been kept low as a result of losses from natural disasters remaining low in recent years as well as insurance companies' tendency to keep higher retentions even with the increase in reinsurance capacity. These developments had positive effects on the Turkish insurance industry.

The market continued to obtain their risk protection through proportional reinsurance contracts written on a bouquet basis, except five companies which obtained their risk protections through Excess of Loss programs. Major factors in easing the reinsurance placements were the absence of significant risk and catastrophe losses in 2015, positive results and the continuation of companies' disciplined business acceptance policies in a consistent manner.

The renewals of the Cat XL programs was rather easier for 2016. These are bought for protection of retained risks under Fire and Engineering branches against natural catastrophes.

While the increased limit of the cover indicated that companies bought more protection than last year, the 8% decline in the amount of premiums paid for Cat XL cover compared to last year demonstrates that more protection was purchased at a lower cost. Accordingly, it could be calculated that in our market, the cost of risk-adjusted Catastrophe Excess of Loss programs decreased by approximately 5-10%.

XPRIMM: Which are your plans for the near future? In which markets are you active and which do you target in near future?
K.A:
Due to the strong commitment to the local insurance industry, Turkish market remains to be the major operating market and MILLI Re aims to continue its leadership of the market. On the other hand, as part of the strategy of transforming from a local reinsurance leader into an international player, MILLI Re has actively engaged in accepting business from emerging markets including Middle East, Asia, Northern and Continental Africa, CIS and Eastern Europe as well as from some developed markets such as Continental Europe and Lloyd's, starting from 2006 to create a geographical diversification in the portfolio, having been able to increase the volume of overseas business from 2.5% in 2006 to 26% at the end of 2015.

Given the fact that MILLI Re has been able to penetrate into most of its target territories, the main aim for the medium term is, under soft market conditions across the emerging markets, to maintain the existing portfolio and to achieve further diversity in business written from these markets by adding accounts which would be selected on the basis of their potential profitability and related exposure and further continue to avoid the retro element in this book in order to avoid clash of exposures.

MENA being the largest business source for Foreign Inward portfolio, it keeps its importance to MILLI Re followed by Asia-Pacific. Our branch office in Singapore puts a valuable effort to develop our portfolio in the region.

MILLI Re, considering the potential in CIS, CEE as well as the African and Latin American markets, has been trying to establish a stable portfolio in these regions by regularly visiting some specifically selected countries to establish long-lasting relationships as well as attending the international conferences to gather market information and the latest developments in each region.

Related articles

photodune-3834701-laughing-girl-xs

Cornel COCA CONSTANTINESCUVice-PresidentASF - the Financial Supervisory Authority, Romania

The Romanian insurance market went through a rough period, marked by several changes in legislation, especially on the MTPL segment, a field of business which is now, for the time time, regulated by a dedicated law. Although still contested in some aspects, the new Law sets up the premises for a better predictability, fair pricing ane better consumer protection.

2017-09-14
photodune-3834701-laughing-girl-xs

Andrea KEENANSenior Managing Director - Industry Relations, A.M.Best USAVice Chair, Microinsurance Network

Microinsurance helps with financial education, family planning, development of small enterprises and maintenance of health, and the products are typically designed to address the specific needs of any given population.  A virtuous cycle develops as this produces income smoothing, larger planning horizons and the development of financial wellbeing.  It is challenging because, to be affordable, scale must be achieved.

2017-07-20
photodune-3834701-laughing-girl-xs

Nicola RAUTMANNMarket Executive Austria & CEE, Swiss ReChristian ENGELNMarket Head Russia & CIS, Swiss Re

We currently expect the immediate impact of digitalization to be on sales, with an increased ability to reach clients and offer cross-selling of products.  Data could be pre-filled, which is likely to increase sales conversions. The full benefits of digitalization however will depend on the extent to which data owners are able to make use of their data, including sharing it with other parties.

2017-07-12
photodune-3834701-laughing-girl-xs

Oleg HANIN, Chairman of the Board, KOMMESK-OMIR

One of the most discussed subjects in our market, in 2016 was the transfer of the road accident claims settlement activity from the independent evaluators to the insurance companies. Despite the surge in negative expectations, the measure resulted in an effective direct, non-intermediated interaction between insurers and their clients which led to the growing customer satisfaction with regard to the claims payment. In KOMMESK-OMIR case, in 2016, the level of satisfaction with the claims payments reached to 91%, while the quality of the settlement of losses was 90%.

2017-07-06
photodune-3834701-laughing-girl-xs

Dr. Vahan AVETISYANExecutive Director of the Armenian MIB

We applied for membership to the Green Card international insurance system in the beginning of 2016 and are currently working in this direction. We have not yet summarized the results of the analysis of Green Card contracts' tariffs, but I do not see any bases for significant change.

2017-06-22
photodune-3834701-laughing-girl-xs

NATIONAL BANK OF SERBIAInsurance Supervision Department

There is a lot of catchup potential of the Serbian insurance market, having in mind the level of its development compared the EU average. We can expect to see a continuation of positive premium developments coupled by a healthy increase of technical provisions. This should translate into sufficient capital adequacy and a continuation of positive trends in profitability, provided that cost pressures are kept in check.

2017-06-15
photodune-3834701-laughing-girl-xs

Vyacheslav CHERNYAKHOVSKYChairman of the CommitteeUkrainian Society of Financial Analysts

There is a tendency to withdraw from insurance business, both on the foreign investors side and on domestic owned companies. In case of the national companies the trend  is more connected with obvious or provoked bankruptcies, while for foreign investors turning off Ukrainian business was caused by the high level of sovereign risk, low rates of economic recovery, insignificant (or even negative) return on capital, etc.

2017-06-08
photodune-3834701-laughing-girl-xs

Fadi AbuNahlGroup Chief Executive Officer & DirectorTRUST Re

Slowing economic growth, continued pressure on pricing, emerging risks (e.g. Cyber hacking) and regulatory changes such as Solvency II in Europe, C-ROSS in China, IRDA in India, and new South African regulations are some of the main challenges we face. Understanding the challenges of reinsurance activity in the CEE also means understanding what stakeholders perceive, what they want, and meeting these expectations. 

2017-05-18
photodune-3834701-laughing-girl-xs

Emmanuil MKRTCHYANGeneral DirectorArmInfo News Agency

The supervisory authority pays attention to the process of automation, digitizing, the creation of databases and on-line services in order to improve the quality of customer service and, last but not least the reduction of the level of fraud not only among unscrupulous customers, but also in the case of insurance agents. A similar database has already been created for the MTPL segment and it will be useful for insurers to promote the voluntary types of insurance.

2017-05-11

ON THE MOVE

TOP EVENT

61st "Rendez-Vous de Septembre" ends today in Monte Carlo: review

The 61st edition of the "Rendez-Vous de Septembre", the annual traditional meeting of reinsurers ends today in Monte Carlo. The Nat Cat insurance protection gap, as well as the global insurance market readiness to deal with the increasing complexity of the cyber risks were among the most debated topics.

14.09.2017

photodune-3834701-laughing-girl-xs

MONTE CARLO: Live news from the "Rendez-Vous de Septembre"

The 61st edition of the "Rendez-Vous de Septembre", the annual traditional meeting of reinsurers has started yesterday in Monte Carlo. XPRIMM publications on the CEE, SEE and CIS insurance markets are available at the XPRIMM stand in Fairmont Hotel as well as at the other event's venues.

10.09.2017

See all