104
Comparison of Regulatory and Supervisory Frameworks
The legal and regulatory environment is separated into two entities in the dual insurance system
economies. However, the Turkish insurance market may not be considered as a dual system,
since the legal and regulatory environment has one standard insurance act. As can be seen from
the main regulators are servicing the conventional and Islamic insurance sectors.
There is one slight difference for the overall Islamic finance sector that the PBAT is serving only
Islamic banking. The most important issue with standard legal and regulatory institutions is the
common pools, which do not separate Takaful funds from conventional funds. Even so, the
policies that have to be followed under national level pools (like liabilities for motor vehicles,
agricultural policies) all type of insurance companies are only agents of the pool operator.
TABLE 16: COMPARISON OF REGULATORY AND SUPERVISORY FRAMEWORKS
Regulator/Supervisor Self-Regulatory Organisation Conventional Islamic
Banking
CBRT ⱱ ⱱ
SDIF ⱱ ⱱ
BRSA ⱱ ⱱ
BAT ⱱ -
PBAT - ⱱ
CapitalMarket
CMB ⱱ ⱱ
BIST ⱱ ⱱ
Takasbank ⱱ ⱱ
Insurance
The Ministry of Treasury
and Finance
ⱱ ⱱ
Pools ⱱ ⱱ
Offices ⱱ ⱱ
Source: Authors
6.3.3. Growth Trends
The first General Takaful company Neova Insurance was established in the year 2009 and the
first Family Takaful company Katilim Pension and Life initiated its operations in Turkey in the
year 2013. However, the first regulations on Takaful came into the picture in 2017 in Turkey.
The Regulation on Working Principles and Procedures of Participation Insurance mainly
regulate the operating models and the Shari'ah Advisory Committee. With such initiatives, there
is a significant prospect for success in the growth and development of the Takaful sector in
Turkey with introduction of new players. Due to the above reasons, the market shares of Takaful
increased a lot and the Takaful sector is picking up momentum. Besides that, Takaful is an
important component of Istanbul Finance Centre Plan and it will have a positive effect on Takaful
industry (SBB, 2019).
Despite the newly established Takaful companies, the motor Takaful segment is one of the most
successful. This level’s strategies have encouraged the provision of Islamic insurance products.
Turkey has attained a significant level of success in motor insurance. Many firms that did not