Examination of the relationship of capital adequacy, concentration and profitability in non-life insurance companies

The concept of insurance providing that we are safe against the risks that we can always experience in our lives has been existed for a long time. The content of insurance has extended and shaped in terms of its importance. Like Solvency studies, there are regulations for protection of especially companies and market. The purpose of the study, at first, is to examine the relationship between the profitability of the insurance companies operating in non-life in our country and the concentration in the sector and also to demonstrate the changes in the rates of capital adequacy. In addition, a mostly negative relationship between profitability and concentration in the companies has been determined, it has been observed that capital adequacy and profitability increase in years when the concentration decreases. The capital adequacy rate of the sector is in the average level according to European Union countries and has the tendency of increasing. When the correlation coefficient between the concentration and the profitability is taken into consideration, it cannot be concluded that also the rates of the profitability are high in the sectors having high concentration rates, as it is possible in Structure-Conduct-Performance Paradigm.