Reinsurance support for the Receivables Insurance System

The State-Supported Commercial Receivables Insurance System, established for the purpose of effectively protecting risks within the scope of commercial receivables insurance, will be provided with 75-110 percent reinsurance support. According to the Presidential Decree on the subject published in today’s Official Gazette, the loss/premium ratio of risks arising from insurance contracts executed in the relevant period, but which cannot be transferred through reinsurance and retrocession; the state will provide 75 percent and above reinsurance support for the share constituting 50 percent of the risks remaining on the Special Risks Management Center and constituting 110 percent and above reinsurance support for the share constituting the remaining 50 percent of the risks constituting the covered. The Special Risks Management Center will be authorized to conclude reinsurance agreements to reduce the reinsurance support committed by the state. The appropriate amount for reinsurance support was determined as five per thousand of the gross premium written after deducting cancellations for each product in the relevant period (from the beginning of April to the end of March of the year applying), and 1.5 percent of the gross premium written after deducting cancellations for each product in the relevant period if the loss/premium ratio for which state support is required is reached. According to the temporary article added to the decision, the provisions of the decision regarding the reinsurance support to be undertaken by the state for the state-supported commercial receivables insurance system put into effect by the Presidential Decree No. 6189 will also be applied to state-supported commercial receivables insurance aimed at providing financing to SMEs between January 7 and March 31.