As a result of the measures taken by the political authorities due to Kocaeli and Bolu-Düzce earthquakes occurred in 1999, the licenses to construct as well as the allocations regarding the public bids were stopped during the first half of 2000 and consequently, a stagnation was experienced especially in the construction insurances. Starting from the mid-year 2000 onwards, this situation changed and a significant increase in the total premiums of the engineering branch was achieved through the insurance premiums of the energy powerhouses set by the model of Build-Operate-Transfer which had to be rated with the quotations given by foreign reinsurers instead of local extensive competitive rates, because of the very high sum-insureds.

On the other hand, the premium of this branch further increased by coming into life of the projects such as highways, dams, sewer systems, water supply and transportation works which were included within the investment programme, through supplying foreign credit therefor, as well as by putting into practise of the earthquake insurances for the dwellings, rates of which were too low because of the competition.

Economical measures put into practise during 2000 resulted with a drop in the interest rates, financial revenues in the insurance industry almost disappeared and technical profitability gained importance. In spite of these facts, extensive rate competition became sharpened in this branch in 2000.

Another important development in this branch was the coming into force of Compulsory Third Party Liability Insurance for the Institutions Controlling the Constructions, general conditions of which were published in the Official Gazette no.24125 on 10th July, 2000; but, unfortunately not being able to find any reinsurer with these general conditions, the insurance companies could not put this insurance type into effect. Also, the new constructions could not be licensed as having this insurance policy was a must to be licensed. To be able to dissolve the congestion in the system, the application of this insurance was postponed by the Ministry of Public Works and Development and Housing as of 16th August 2000 for a period of six months with the approval of Undersecretariat for the Treasury.

The total policy number in this branch increased by 18,91 percent to 91.087 in 2000 whereas it was 78.271 in 1999.

The 2000 premium income in the engineering branch, where 40 companies were active, increased to 68,6 trillion Turkish Liras representing a 75,47 percent, increase in current prices and 40,58 percent in terms of the US Dollar over the previous year.

Consequently, the proportion of the engineering branch's premium production within the total dropped to 3,83 percent in 2000, whereas it was 3,96 percent in 1999.

The loss ratio in this branch was of 69,37 percent in 2000 representing a remarkable decrease in comparison to the previous year.

This branch's share within the total technical profit dropped to 6,73 percent in 2000 whereas it was 11,73 percent in 1999.