Participation Insurance

Insurance and Private Pension Practice within the Scope of Participation Principles

The “Regulation Related to Insurance and Pension Activities in the Frame of Particitipation Insurance Principals”, (“Regulation”) which regulates the principles and procedures necessary for carrying out insurance and personal pension activities within the scope of participation principles is entered into force in Official Gazette No:31339 dated to 19.12.2020.

Consistently Katılım Emeklilik ve Hayat A.Ş. (“Company”) applies the insurance and private pension practice within the scope of participation principles. The most crucial principle of Company within a private pension, health, and personal accident insurance segments is the due diligence exercised to participation principles in all processes and agreements. 

It is one of our essential principles to be transparent, reliable, and open to the insured/ participant in insurance contracts and notifications in accordance with the insurance legislation and tariff approval. 

Participation based insurance and individual retirement express the insurance and individual retirement activities executed within the scope of relevant legislation, based on the procedures and principles determined by the Advisory Committee.

In our insurance practice, where religiously permissible matters and risks are secured under the supervision of the Advisory Committee as specified in Article 5 of the Regulation, and financial assets are managed within the framework of participation principles:

· The products and services to be offered by the Company and the forms, contracts, policies and information texts to be issued are submitted to the approval of the Advisory Committee. Products and services that are not deemed appropriate cannot be sold, subjects and risks cannot be quaranteed, and benefits cannot be obtained from these issues and risks.

· Participation principles are also applied the payments made to the company, in the investments made, in the expenditures in the administrative areas related to its evaluation. Financial assets can be invested in the following accounts and investment instruments upon approval of the Advisory Committee:

·        Opening participation accounts in participation banks,

·        Investing in stocks suitable for the participation index,

·        Investing in gold, silver, other precious metals, and capital market instruments based on the same with interest-free methods, interest-free income, or investment instruments such as Public or Private Sector Sukuk, Lease Certificates, etc., issued in Turkey or abroad and approved by its own Advisory Committee,

·        Interest-Free Mutual Funds and Interest-Free Exchange Traded Funds approved by the Advisory Committees of the Companies,

·        Other investment instruments to be approved by the Advisory Committee

The payments received by our company, payments made by the company, the selection and assessment of assets to be invested in, cash management, and other related financial activities of the company are performed subject to participation principles.

We meet the expectations of our people who has religious concerns to interest in the best way, both with participation-based PPS and other products in participation insurance, both in terms of quality and services and technological infrastructure and accessibility.

Participation Pension Funds and Segments in which Participation Insurance is Applied

Our company carries out its Participation Insurance activities in the segments of Life, Personal Accident, and Health Insurance for which it is licensed. It also establishes business and transactions in Voluntary Pension and Auto Enrollment System products according to the interest-free pension principles.

During the establishment of the participation pension fund, the Advisory Committee’s approval is obtained in the selection and updating of assets, in the selection of the accounts, in which collection of participation share, withdrawal, exit, transfer, and pension transactions are managed in cash.

Advisory Committee

The Advisory Committee refers to the committee that monitors the compliance of the operation of the Participation Insurance with the principles of the participation finance system and the principles of joint risk-sharing and solidarity.

In our Company, where all of our funds and products are participation-based, as Katılım Emeklilik ve Hayat A.Ş., we have an Advisory Committee supporting us in our compliance with the participation principles since its establishment.

We are progressing in all our product and service offerings and all our activities with the approval and supervision of our committee. Products and services deemed unsuitable by our Advisory Committee are not offered to customers by our Company.

Private pension activities that the advisory committee should approve in terms of compliance with participation principles are listed below:

a) Establishment of participation pension funds.

b) Selection of assets included in the portfolio.

c) Deduction structure, additional benefits provided, and other matters within the scope of the plan.

d) Selection of the accounts in which collection of participation share, withdrawal, exit, transfer, and pension transactions are managed in cash.

In addition, our Advisory Committee fulfills the following duties as well:

a) Contributing to the product and service development and system improvement processes within the scope of the participation principles and to the creation of policies and procedures.

b) Approving the products and services to be provided as well as any form, agreement, policy, and information note to be issued.

c) Answering the questions related to the compliance of the company activities with participation principles and providing alternative solutions if necessary.

d) Giving consultation to the Board of Directors and related departments regarding implementing participation principles and developments in our country and the world in the participation finance field. 

e) Giving assent at least once a year whether the provided products, services, and the activities conform to participation principles.

The Board of Directors of Katılım Emeklilik ve Hayat A.Ş. is responsible for carrying out the activities listed above, as approved by the advisory committee.

Our Advisory Committee consists of 3 members;

Please click here to access the CV of Prof. Dr. Hamdi Döndüren (Chairman of the Advisory Committee).

Please click here to access the CV of Dr. Mustafa Dereci (Vice Chairman of the Advisory Committee).

Please click here to access the CV of Mehmet Odabaşı (Member of the Advisory Committee).

Participation Reinsurance

Reinsurance is the practice whereby insurance companies share their liabilities by transferring the risks they assume with their insurance activities to other companies (reinsurance companies) that will undertake these risks, in whole or in part. In this way, insurance companies have the opportunity to expand the assurance they offer.

Katılım Emeklilik ve Hayat A.Ş. works with Swiss Reinsurance Company Ltd (Swiss Re), the world’s largest reinsurance companies, in the participation reinsurance/reinsurance transactions of life and accident segments. The participation reinsurance contracts have been established with Swiss Re Asia Pte. Ltd. (Swiss Re Retekaful) in Malaysia, which operates based on Islamic finance principles. Additionally, a co-insurance agreement has been made in the health sector with Neova Participation Insurance.

Throught the participation reinsurance agreements we make annually, we are able to offer our customers comprehensive coverage in the life and accident segments.

Our reinsurers are well-known and trusted companies in our country and abroad with a long-standing background and substantial capital. Our reinsurers are awarded with high ratings by independent international rating agencies abroad.

Legislation

Regulation

Please click here for Regulation Related to Insurance and Pension Activities in the Frame of Particitipation Insurance Principals

Circular

Please click here for the Circular on Participation-Based Insurance and Private Pension Activities