Newsletters
Insurance shares listed on Türkiye’s stock exchange, Borsa Istanbul, fell on Wednesday as the overall market extended its record-breaking run, following the decision to set the state contribution rate for Turkish lira payments into individual private pension accounts at 20%.
While the benchmark BIST 100 index reached a new all-time high above the 12,100 level, insurance stocks were among the biggest losers in early trading. The insurance sub-index fell by as much as 0.85% at its lowest point.
Among the major insurers, Anadolu Hayat Emeklilik plunged 4%, while Türkiye Sigorta fell 1.2%, Agesa dropped 2%, and Aksigorta declined 0.9%, though they later recovered much of the losses in line with broader market optimism.
According to the decision, the government will now match 20% of individual contributions made in Turkish lira to Private Pension System (BES) accounts, down from the previous 30%. The change excludes employer-paid contributions and applies only to contributions made by individual participants.
The revised incentive structure also includes additional matching contributions for participants who do not exercise their right to withdraw from the plan during the opt-out period, although further details on this mechanism were not disclosed in the statement.
In a statement following the policy change, the Insurance Association of Türkiye (TSB) emphasized that the incentive remains meaningful despite the adjustment.
"State contributions continue strongly in the new period at a rate of 20%," the statement said. "When compared with international practices and alternative investment tools, this still represents a high and meaningful level of incentive."
The association also noted that current figures show the BES has evolved beyond a system reliant solely on state support, stating that it now represents a deepened, permanent, and robust savings and investment ecosystem.
BES is a voluntary, government-backed savings scheme introduced in 2003 to supplement Türkiye’s public social security. Participants make regular contributions to privately managed funds, which are invested according to individual risk preferences.
Accumulated savings, comprising state contributions, returns, and individual payments, can be accessed after 10 years in the system and age 56, or upon official retirement.
In addition to domestic participants, the program also serves as an investment route for foreigners seeking Turkish citizenship. Under current rules, foreign nationals may qualify for citizenship by committing at least $500,000, or the equivalent in Turkish lira, to a BES account for a minimum of three years.
The latest data shows that the combined asset size of the BES and the Automatic Enrollment System (OKS) has reached ₺2.21 trillion ($51.32 billion). Of this, ₺1.93 trillion was accumulated through participant contributions, while ₺240.73 billion was provided by the government’s matching support mechanism.
Set as preferred source
1 min read
1 min read
