TURKISH INSURANCE INDUSTRYAND

GUNES SIGORTA

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• National Income: GDP : 1.080 Billion TL = 717 Billion USD GDP per capita: 9 728 USD

• Inflation: CPI (consumer price index): 6.40 % PPI (producer price index): 8.87 %

• Unemployment: 11.4 %• Population: 73,7 million

June 2011

TURKISH ECONOMY IN 2010

TURKISH INSURANCE INDUSTRY

NON LIFE11.528.123.146 TL which represents 81,58 % of the total premium income and a growth of 14,5 % compared to 2009.

Premium Income

2.602.153.036 TL which is 18,42 % of the total premium income and a growth of 17,53 % compared 2009.

MARKET INCOME

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14.130.276.182 TL, an increase of 15 % compared to 2009

LIFE

June 2011

TURKISH INSURANCE INDUSTRY

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PREMIUM PRODUCTION (2006-2010)

Source: Association of Insurance and Reinsurance companies of Turkey

June 2011

TURKISH INSURANCE INDUSTRY

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PREMIUM INCOME SPLIT 2010

Accident26.30%

Health12.07%

Air Vehicles & Liability0.69%

Marine2.88%

Fire14.62%

General Losses7.03%

MTPL18.01%

General Liability2.32%

Credit & Suretyship0.34%

Legal Protection

0.30%Life

15.44%

The below graphs shows market share of the branches for 2010.

The accident branch, which is mainly consist of motor own damage premium ,is stil the largest one.

Source: Association of Insurance and Reinsurance companies of Turkey

June 2011

TURKISH INSURANCE INDUSTRY

PREMIUM PRODUCTION IN% OF GBT

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NON-LIFE PREMIUM PRODUCTION IN% OF GBT

TOTAL PREMIUM PRODUCTION IN% OF GBT

Source: Association of Insurance and Reinsurance companies of Turkey

June 2011

TURKISH INSURANCE INDUSTRY

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TOTAL PREMIUM PRODUCTION PER CAPITA (USD)

Source: Association of Insurance and Reinsurance companies of Turkey

June 2011

TURKISH INSURANCE INDUSTRY

LIFE & NON LIFE PREMIUM PRODUCTION (TL) 2006-2010

2006 2007 2008 2009 2010

Change between

2010-2009Accident 3.361 3.975 3.359 3.214 3.716 15,60%Health 983 1.218 1.327 1.415 1.705 20,50%Air Vehicles&Liability 0 0 63 104 98 -6,50%Marine 346 365 414 374 407 8,70%Fire 1.585 1.717 1.872 1.994 2.065 3,50%General Losses 485 619 822 930 993 6,80%MTPL 1.479 1.651 2.060 2.249 2.545 13,10%General Liability 0 0 233 251 328 30%Credit&Suretyship 8 14 37 45 48 6,60%Legal Protection 26 39 32 36 43 20,70%Total Non-Life 8.274 9.597 10.199 10.614 11.948 12,60%Total Life 1.386 1.412 1.575 1.822 2.181 19,70%Total 9.660 11.010 11.774 14.436 14.129 13,60%

Source: Association of Insurance and Reinsurance companies of Turkey

June 2011

TURKISH INSURANCE INDUSTRY

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TECHNICAL RESULTS

Although overall loss ratio decreased to 67.03% in 2010 from 75.31% from 2009, total non life companies produced a minor technical loss in 2010, while it was 1.04% technical profit in 2009. The main reason of this worsening on technical results comes from MTPL branch, its technical loss reached to 17.22% in 2010 while it was 5.27% in 2009. While loss ratio in Accident and health branches are improving, general liability branch produce a technical loss in 2010. Fire loss ratio improved to 31.46% in 2010 from 63.11 in 2009, which this branch had important flood losses in September 2009. On the other hand overall, new reserving had also high contribution to the worsening of the technical results in 2010.

2009 (TL) 2010 (TL) Loss Ratio % Technical Profit % Loss Ratio % Technical Profit %Accident 79,29 -4,05 69,3 1,87Health 91,81 -8,26 84,47 -2,01Air Vehicles&Liability 44,21 -0,75 108,76 -5,85Fire 63,11 9,71 31,41 10,07Marine 44,2 30,69 26,16 31,99Credit&Suretyship 84,23 -2,94 2,06 22,31General Losses 57,24 8,21 42,08 5,2Land Vehicles Liability(MTPL) 83,73 -5,27 97,08 -17,22General Liability 80,46 28,32 90,58 -5,58Legal Protection 4,12 57,15 0,97 50,44Total Non-Life 75,31 1,04 67,03 -0,04

Source: Association of Insurance and Reinsurance companies of Turkey

June 2011

TURKISH INSURANCE INDUSTRY

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TOP TEN INSURANCE COMPANIESComparison of Market Shares

Rank Non-life Companies Market Share (%)

Life Companies Market Share (%)

1 Axa 12,71 Ziraat Hayat ve Emeklilik 27,59

2 Anadolu 11,89 Anadolu Hayat Emeklilik 16,38

3 Allianz 8,33 Garanti Emeklilik 10,74

4 Ak 7,41 Halk Hayat ve Emeklilik 6,48

5 Yapı Kredi 6,35 AvivaSA 5,70

6 Gunes 6,17 Yapı Kredi Emeklilik 5,03

7 Groupama 5,81 Finans Emeklilik ve Hayat 3,91

8 Ergo 5,81 Vakıf Emeklilik 3,82

9 Eureko 5,18 Allianz Hayat ve Emeklilik 3,41

10 Mapfre Genel 3,45 Deniz Emeklilik ve Hayat 2,77

Top Ten Companies 73,09 Top Ten Companies 85,83

Source: Association of Insurance and Reinsurance companies of Turkey

June 2011

TURKISH INSURANCE INDUSTRY

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FINANCIAL RESULTS

Non-life companies total return on equity is decreasing as from 2008 and in 2010. This decline is coming fram mainly reduced investment incomes and poor technical results.

Profitability of Non-Life and Life Companies over 5 Years (million TL)

0%

2%

4%

6%

8%

10%

12%

14%

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

2006 2007 2008 2009 2010

Net profit Equity Capital Return on Equity

Source: Association of Insurance and Reinsurance companies of Turkey

June 2011

TURKISH INSURANCE INDUSTRY

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CHANGE IN MARKET SHARES

Branches 2010-12 Premium

Production (TL) SHARE(%) 2009-12 Premium Production (TL) SHARE(%) CHANGE

ACCIDENT 598.383.023 5,01 540.446.289 5,09 10,72%HEALTH 1.705.491.729 14,27 1.415.181.842 13,33 20,51%LAND VEHICLES 3.116.553.873 26,08 2.671.260.772 25,17 16,67%RAIL VEHICLES 680.830 0,01 152.925 0,00 338,81%AIR VEHICLES 47.397.058 0,40 57.327.385 0,54 -17,32%WATERBORNE VEHICLES 107.866.780 0,90 112.590.114 1,06 -4,20%MARINE 298.641.084 2,50 261.394.034 2,46 14,25%FIRE 1.979.817.594 16,57 1.925.464.137 18,14 2,82%GENERAL LIABILITY 993.472.682 8,31 934.627.948 8,81 6,30%LAND VEHICLES LIABITY 2.544.954.031 21,30 2.249.453.148 21,19 13,14%AIR VEHICLES LIABILITY 50.256.018 0,42 47.104.205 0,44 6,69%WATERBORNE VEHICLES LIABILITY 544.021 0,00 374.488 0,00 45,27%GENERAL LIABILITY 327.658.844 2,74 251.945.709 2,37 30,05%CREDIT 31.775.341 0,27 27.711.707 0,26 14,66%FIDELITY GUARANTEE 16.452.876 0,14 16.641.819 0,16 -1,14%FINANCIAL LOSSES 84.708.056 0,71 65.386.767 0,62 29,55%LEGAL PROTECTOIN 43.349.341 0,36 36.693.364 0,35 18,14%NON-LIFE TOTAL 11.948.003.182 100 10.613.756.654 100 12,57%

Source: Association of Insurance and Reinsurance companies of Turkey

June 2011

TURKISH INSURANCE INDUSTRY

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PREMIUM PRODUCTION PER DISTRIBUTION CHANNELS(%)

Non-Life

2009 2010

Direct Sales 6,39 7,46

Insurance Agencies 70,60 69,10

Bank Agencies 12,48 13,40

Brokers 10,56 10,10

June 2011

TURKISH INSURANCE INDUSTRY

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MARKET COMPOSITION

INSURANCE AND REINSURANCE COMPANIES

2006 2007 2008 2009 2010

Insurance companies 53 56 59 58 62

Life 21 21 23 22 24

Non life 32 35 36 36 38

Reinsurance companies 2 2 2 2 2

TOTAL 55 58 61 60 64

As of March 2011, the Association has 64 members. Out of these 64 companies, 62 are insurance (10 life, 14 life and pension and 38 non-life companies )and remaining 2 are reinsurance companies.

Market Composition

Source: Association of Insurance and Reinsurance companies of Turkey

June 2011

TURKISH INSURANCE INDUSTRY

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PERFORMANCE OF THE TURKISH REINSURANCE MARKET IN 2010

•The non-profitable motor lines lead most of the insurance companies towards more profitable non-motor lines which in resulted in cheaper pricing to get new market share.

• Despite a growth higher than the inflation rate, the sector concluded a consolidated loss for all lines of business combined, on non-life. The non-life industry grew in average app 13,6%.

• As for the number of policies, the figure reached 40,1 million in 2010 which is an approximately increase of 19% when compared to 2009.

June 2011

TURKISH INSURANCE INDUSTRY

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PERFORMANCE OF THE TURKISH REINSURANCE MARKET IN 2010

Property(inc. Engineering)

Casualty

Marine

The direct market for general casualty business i.e. general third party liability, employers liability etc. is still under heavy competition. Compulsory coverages like medmal and onshore pollution liability finds limited cpacity and interest in international markets.

•The free tariff application for earthquake for sum insureds above TL 100 million is perceived well by the clients but not very much so by the market. Also, the advisory tariff for terrorism business is no longer applicable. Even though it may stay as a prerequisite for some treaty acceptances, most of the business in the direct market runs without the assumed rates.

The premium growth in the marine sector in 2010 was 15.56% despite the fact that marine insurance rates fell heavily and the softening trend is expected to continue in 2011 as well.

There is enough capacity provided through the local market.

June 2011

TURKISH INSURANCE INDUSTRY

Solvency IIIn Turkey’s EU harmonization process, the Turkish insurance sector has been conducting studies on the implementation of Solvency II. A sample of ten insurance companies were determined to conduct Quantitative Impact Study 4 (QIS 4), which had previously been conducted by the European Commission in EU countries. QIS 5 was also started to be applied from December 2010.

Regulation on Technical ReservesThere have also been major amendments to the “Regulation on Technical Reserves of Insurance, Reinsurance and Pension Companies”. In this context, a more developed and sophisticated actuarial chain ladder method for the calculation of IBNR reserves has been introduced.

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HIGHLIGHTS

June 2011

TURKISH INSURANCE INDUSTRY

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HIGHLIGHTS

Medical Malpractice

Medical malpractice insurance became compulsory in Turkey in July 2010. With the introduction of “Compulsory Liability Insurance on Medical Malpractice”, doctors and dentists are required to be covered by professional liability insurance. Doctors working at public or private institutions will pay half their insurance premiums and their institutions will pay the remainder. Doctors working at their own private offices will pay the entire premium.

Coastal Facilities Sea Pollution Compulsory Liability Insurance

Another compulsory insurance that was introduced in 2010 with the publication of tariffs and procedures is the “Coastal Facilities Sea Pollution Compulsory Liability Insurance. In this context, all coastal facilities (including refineries, gas terminals, power houses, industrial production facilities, shipyards, etc.) are obliged to be covered by insurance against sea pollution.

June 2011

TURKISH INSURANCE INDUSTRY

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HIGHLIGHTS

Recent MTPL limits are stated as 20.000/40.000 TL for material damage and for 200.000 TL for bodily injury from 01.01.2011 and those limits are still considered to be low and do not provide enough coverage for insured.

Maximum limits for TCIP are increased from 140.000 TL to 150.000 TL as of 01.01.2011

•According to the new law, hospital benefits after traffic accidents will be will be handled and paid by Ministry of Health. Certain percentage of the premium in order to settle the bodily injury claims, which is not yet fixed, will be transfered to Ministry of Health.

June 2011

TURKISH INSURANCE INDUSTRY

GUNES SİGORTA

IN FIGURES

20June 2011

GUNES SIGORTA – PROFILE

Corporate name : Güneş Sigorta A.Ş. Date of Foundation : 17.09.1957 Authorized Capital : 300.000.000 TL Paid Capital : 150.000.000 TL

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SHAREHOLDERS AMOUNT OF SHARE

TRY. RATE OF

SHARE % Türkiye Vakıflar Bankası T.A.Ş. 51.336.302 34,22Groupama International 45.000.000 30Vakıfbank Employees Private Social Security Services 15.000.000 10

T.V.B. Employees Retirement&Health Funds Foundation

7.515.000 5,01

Stocks offered to the Public 31.148.698 20,77Total 150.000.000 100

GUNES SIGORTA

INFIGURES

June 2011

KEY FIGURES

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2010 2009

Number of Policies 3.093.601 3.038.702

Total Premium Production 737.368.263 727.074.961

Paid Losses 439.169.040 438.878.201

Growth Rate (%) 1,4 2,5

Rank 6 5

Market Share 6,4 7,22

Technical Profit (TL) 19.335.478,00 34.177.927,00

Net Profit (TL) -32.445.443,00 -15.138.120,00

Number of Agencies 2.654,00 2.439,00

June 2011

GUNES SIGORTA

INFIGURES

KEY FIGURES

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Premium Production 2009-2010

Premium Production (TL) 2010 2009

Fire 107.059.126 107.838.563Motor & Misc.

Accident 246.450.202 258.118.465

Motor TPL 185.994.659 168.344.839

Health 56.208.419 58.012.183

Others 141.655.857 134.760.911

Total 737.368.263 727.094.668

June 2011

GUNES SIGORTA

INFIGURES

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KEY FIGURES

June 2011

GUNES SIGORTA

INFIGURES

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OUR AGENCY NETWORK

June 2011

GUNES SIGORTA

INFIGURES

YEARS 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

T.VAKIFLAR BANKASI 355 359 350 322 299 294 292 301 302 340 420 442 538

OTHER BANKS 67 87 90 31 42 65 80 89 107 223 205 271 279

BROKERS 7 10 12 17 23 28 33 39 47 48 54 59 62

EXCLUSIVE AGENTS 693 703 788 811 867 911 946 965 982 1.238 1.421 1.667 1.760

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OUR AGENCY NETWORK

Development of Exclusive Agency Network

Development of Bankassurance

June 2011

GUNES SIGORTA

INFIGURES

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PREMIUM PRODUCTION

BRANCH 2009 2010 RoCACCIDENT 11.766.597 12.385.895 5,3%HEALTH 58.012.183 56.208.419 -3,1%LAND VEHICLES 186.817.241 170.915.777 -8,5%AIR VEHICLES 16.110.728 17.380.629 7,9%MARINE HULL 13.789.280 7.867.247 -42,9%MARINE CARGO 12.407.099 14.021.249 13,0%FIRE 131.446.919 128.725.398 -2,1%GENERAL LOSSES 86.583.946 99.461.272 14,9%LAND VEHICLES LIABILITY 168.344.839 185.994.659 10,5%AIR VEHICLES LIABILITY 22.641.888 24.520.206 8,3%MARINE LIABILITY 0 0 0,0%GENERAL LIABILITY 11.351.825 12.263.724 8,0%CREDIT 81.957 3.814 -95,3%SURETYSHIP 1.753.856 1.821.641 3,9%FINANCIAL LOSSES 2.242.524 2.182.841 -2,7%LEGAL PROTECTION 3.671.127 3.615.494 -1,5%TOTAL 727.022.010 737.368.263 1,4%

June 2011

GUNES SIGORTA

INFIGURES

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FINANCIAL INDICATORS

(Million TL) 2006 2007 2008 2009 2010 2011-1Q

Income Statement        

Gross Written Premiums 512,4 637,5 709,6 727,0 737,4 230,1

Net Written Premiums 260,9 342,8 373,9 395,0 415,7 109,9

Net Earned Premiums 244,1 290,8 342,6 375,0 409,7 105,9

Net Claims Incurred -196 -233,1 -269,0 -308,6 -341,8 -84,4

Net Commission Expenses -13,2 -14,1 -53,7 -29,4 -41,9 -8,4

Net Technical Profit 29,2 49,4 57,0 30,0 18,4 10,4

         

General Expenses -31,3 -43,7 -59,5 -62,4 -70,1 -18,2

Profit Before Tax 2,4 10,2 15,7 -16,8 -32,4 -5,3

Net Profit* 2,4 7,0 11,1 -16,8 -32,4 -5,3

         

Balance Sheet

Total Assets 401,8 498,7 655,6 736,7 782,7 797,7

         

Shareholders’ Equity 161,2 197,0 230,1 236,6 242,3 238,9

June 2011

GUNES SIGORTA

INFIGURES

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MARKET SHARE DEVELOPMENT Comparison of Top Ten Companies

FIRE 2008 2009 2010

Axa 14,88% 15,41%14,22

%

Anadolu 12,13% 11,80%11,49

%Ak 7,52% 7,67% 7,11%

Allianz 8,99% 9,16% 9,21%Groupam

a7,05% 6,86% 4,37%

Guneş 7,58% 6,83% 6,50%Yapı Kredi

5,06% 4,72% 5,23%

Eureko 6,16% 6,51% 6,38%

Ergo 5,85% 5,18% 5,18%Mapfre Genel

3,51% 3,52% 3,12%

June 2011

GUNES SIGORTA

INFIGURES

MARINE 2008 2009 2010

Axa 9,79%10,28

%8,79%

Anadolu 10,2110,40

%10,13

%

Ak 7,77% 6,69% 5,43%

Allianz 10,93%10,27

%9,06%

Groupama 5,55% 5,22% 5,27%

Guneş 5,21% 4,75% 4,70%

Yapı Kredi 3,94% 3,70% 3,72%

Eureko 6,07% 6,61% 6,21%

Ergo 10,94%10,17

%10,58

%Mapfre Genel 5,88% 5,66% 6,79%

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MARKET SHARE DEVELOPMENT Comparison of Top Ten Companies

June 2011

GUNES SIGORTA

INFIGURES

 LAND VEHICLES

2008 2009 2010

Axa 17,79% 16,24% 14,87%

Anadolu 12,51% 12,98% 15,13%

Ak 10,06% 9,86% 9,89%

Allianz 6,57% 6,40% 6,24%

Groupama 8,32% 8,20% 6,57%

Guneş 7,04% 6,99% 5,48%

Yapı Kredi 4,00% 3,73% 4,74%

Eureko 4,11% 3,94% 4,89%

Ergo 7,67% 7,60% 7,31%

Mapfre Genel

3,45% 3,86% 3,61%

MOTOR TPL

2008 2009 2010

Axa 13,15% 14,69% 20,55%

Anadolu 9,19% 10,60% 9,48%

Ak 8,33% 7,04% 5,32%

Allianz 5,14% 4,18% 3,65%

Groupama 9,15% 7,29% 6,18%

Guneş 7,80% 7,76% 7,53%

Yapı Kredi 2,48% 2,02% 2,18%

Eureko 1,41% 1,63% 2,14%

Ergo 12,12% 10,56% 6,82%

Mapfre Genel

3,72% 3,49% 4,16%

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MARKET SHARE DEVELOPMENT OF TECHNICAL BRANCHES

June 2011

GUNES SIGORTA

INFIGURES

HEALTH 2008 2009 2010

Axa 0,23% 0,71% 3,71%

Anadolu 10,10%10,82

%10,31%

Ak 7,74% 8,28% 8,08%

Allianz 19,10%18,57

%17,81%

Groupama 4,88% 4,91% 5,64%

Guneş 4,52% 4,10% 3,30%

Yapı Kredi 21,76%20,11

%19,78%

Eureko 1,94% 1,95% 2,53%

Ergo 1,16% 2,75% 3,21%

Mapfre Genel

2,19% 2,24% 2,25%

GENERAL LOSSES

2008 2009 2010

Axa %8,60 % 9,94 % 7,41

Anadolu %9,67 % 10,64%

11,16

Ak %7,55 % 9,23 % 6,47

Allianz %6,48 % 6,25 % 5,15

Groupama %10,11 % 9,91 % 9,59

Guneş %11,29 % 9,31%

10,01Yapı Kredi %4,67 % 4,64 % 5,56

Eureko %8,49 % 10,45 % 8,15

Ergo %4,41 % 2,80 % 3,03

Mapfre Genel %4,76 % 4,44 % 4,63

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OUR REINSURANCE PANEL

June 2011

GUNES SIGORTA

INFIGURES

Our Treaty Reinsurers

European MarketFar East MarketMiddle East Market

Facultative Placements

Fire Local

Engineering Local & Middle East Markets

Liability London Market

Marine Local

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STRATEGIC FOCUS AREAS

June 2011

GUNES SIGORTA

INFIGURES

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TURKISH MARKET REQUIREMENTS

June 2011

GUNES SIGORTA

INFIGURES

Back to back cover

As per original policy terms, warranties, clauses and conditions

Follow the original settlements/fortune in every respect

Subject to Turkish Law, Practice and Jurisdiction

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CONTACT INFORMATION

June 2011

GUNES SIGORTA

INFIGURES

Thank you for your attention

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