Insurance Lloyd's that operate in more than 200 countries across the globe set sights on India, China, Colombia and Malaysia as well as developing countries such as Turkey where assets and infrastructures to be protected are becoming more valuable each other day. Lloyd’s aims to offer insurance solutions in international standards in Turkey that stood out for the strong growth and increased demand for business and specialized insurance products during the last 5 years. As Strategy magazine we asked Lloyd’s Global Markets, International Market Development Executive Kaan Yardımcı about Lloyd’s targets for the Turkish market that is defined by the company as one of the 11 countries that are underinsured for natural hazards, effects of global developments on the insurance industry and the risks carried out by Istanbul that is positioned as an international finance hub. How many countries does Lloyd’s operate across the world? Can you please inform us on your most important markets? Lloyd’s operates in more than 200 countries across the globe. Our largest market is North America which makes up around half of our total business volume. North America is followed by United Kingdom and continental Europe. We also aim to develop our business and extend our presence in new markets such as India, China, Malaysia, Colombia and Turkey. These markets have strategic importance for us due to their fast growing economies and low insurance penetrations. For what industries Lloyd’s offer services? Which have the highest volume? Lloyd’s covers all economic fields from large infrastructure and energy projects to transportation, finance, professional services and SMEs. Our widest product range is within reassurance, real estate, accountability and maritime categories. How do global developments affect insurance industry? What are your insights for the upcoming period? Current low interest rate environment paved the way for a capital rush in our industry. We are witnessing a record amount of capital regarding insurance and reassurance. This situation creates a tremendous pressure in ratio and profitability. It is very important to oversee and maintain discipline in such environments. As Lloyd’s you are very keen to enter the Turkish market. What are your thoughts on Turkish insurance market’s potential? Turkish insurance industry lived through a strong growth process during the last five years. Even though this growth was mostly sourced from individual category, the demand in business and specialized insurances is also increasing in a serious pace. Turkish business environment encounters with new types of risks every day and seeks for new solutions and services in order to meet them. That is exactly where Lloyd’s comes into play. We can adapt our global expertise into Turkish environment and support Turkish insurance industry in covering complex and difficult to insure contingencies. Can you please elaborate your targets and aims regarding the Turkish market? For instance, how many syndicates do you expect to come in to the country when you begin operating in Turkey? Lloyd’s aims to establish a local presence and create value in Turkey. Turkey is a fast growing market which will have its role become more important in global economy. Lloyd’s is aware of the strategic importance of the local presence it will establish in Turkey. Our presence will create the opportunity to develop insurance and reassurance coverages that will support Turkey’s growth. Our aim to focus in specialized products and grow organically is in line with the growing demand towards these products. We will not compete with the local market in traditional categories. What are your comments on Istanbul’s aim to becoming an international finance hub? What will be the role for multinational insurance companies in realizing this goal? Can Istanbul become a hub similar to Dubai and Singapore regarding insurance business? Throughout history Istanbul was a unique trade hub which connects Asia and Europe. It becoming an international finance center will be realized with the efforts and robustness of its economy. Turkey continues to be one of the fastest growing economies of the world. Istanbul which houses over one fourth of its total GDP is key to this growth. Turkey’s development on the direction of becoming a hub regarding international finance supports itself on maintaining as a trade bridge between east and west. These developments pave the way for Turkish companies to open new doors to enter international markets. Multinational companies stand out as important factors that constitute economic excellence as much as insurance companies are. They invest in qualified workforce and infrastructure by capitalization. In this framework insurance and reassurance companies move risks out of the country. While Turkish economy grows, values of assets and infrastructures that need to be protected increase as much. Estimated 82.5 billion dollars of Istanbul’s 500 billion GDP is under risk of 18 financial and natural hazards especially earthquake. Is Turkey secure enough against these financial and natural risks? According to Lloyd’s’ research Turkey is among the 17 underinsured countries. The damage of a hazard will be put on Turkey’s capital and taxpayers and slow economic growth and improvements. The same is true for all underinsured countries. All damages will be put on governments and companies therefore create a deficit. Especially in fast growing countries, insurance is mostly not taken serious enough however governments tend to liberalize insurance markets and close this gap. International insurance and reassurance companies can erase risks caused by natural disasters from countries’ balance sheets and support them into having more capital to recover from these damages. Lloyd’s research proves that a 1% increase in insurance penetration lowers uninsured losses by 13% meaning a 22% decrease in taxes to be paid following a critical disaster and cause an investment increase totaling 2% of the total GDP.