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Elnur Enveroglu

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The First Assembly of the Turkic World Insurance Union (TWIU), held in the historic Azerbaijani city of Shusha, marked a pivotal step in deepening the financial and economic integration of the Turkic states. What may initially appear as a technical gathering of insurers carried far greater significance, both in terms of institutional development within the financial sector and the wider geopolitical and geo-economic transformation of the Turkic world.

The choice of Shusha as the venue was not accidental. The city, emblematic of resilience and renewal after decades of occupation, provided a symbolic setting for a meeting that itself underscored a new era of unity and strategic ambition among Turkic nations. The signing of a joint “Proclamation Document” formalised the Union’s structure and expanded its scope to include not only the five founding members but also three observer organisations, including Hungary, Turkmenistan, and the Turkish Republic of Northern Cyprus. This inclusivity signals both the Union’s flexibility and its broader appeal as a platform for cooperation.

Moreover, the Turkic World Insurance Union’s reformation under the principles of the Organisation of Turkic States (OTS) demonstrates the consolidation of a shared vision: that economic cooperation must move beyond trade figures and infrastructure projects into the realm of financial and risk management systems. Insurance, often an overlooked pillar of financial development, is in fact crucial for enabling investment, protecting households and businesses, and underpinning sustainable growth.

The stated goals of the Union, such as to promote the exchange of expertise, personnel, and information, to build systematic reinsurance relationships, and to advance the sustainable development of member states’ insurance markets, are not mere platitudes. They point to a concerted effort to professionalise the insurance sector, reduce vulnerabilities, and create regional standards that reflect best global practices while respecting local particularities.

This institutionalisation also mirrors a broader pattern within the OTS: a shift from cultural and political solidarity towards concrete economic structures capable of delivering tangible benefits to member populations.

As for the international significance of the event, it can also be emphasized as an Azerbaijani experience or as a reform model. The Azerbaijani case provides a useful lens through which to understand how the insurance sector can be transformed into a lever of national and regional development. Aliyar Mammadyarov, First Deputy Chairman of the Central Bank of Azerbaijan (CBA), outlined the recent trajectory of reforms during his address in Shusha. The Financial Sector Development Strategy for 2024–2026, which has been under implementation for nearly two years, has already produced notable achievements.

Among the most important reforms are the introduction of new corporate governance standards, compelling insurers to disclose extensive information about their financial results and stability. These changes are fostering a more transparent and competitive environment, aligned with international best practices. In addition, enhanced cooperation between banks and insurers has been facilitated, while consumer protection has been strengthened through new rules for individuals taking out loans with life insurance.

Digitalisation has been another cornerstone of reform. The move towards electronic contracts and greater accessibility is both modernising the sector and increasing its appeal to younger, tech-savvy populations. Moreover, promotional campaigns and professional training initiatives are ensuring that awareness of insurance grows not only among businesses but also among the general population.

The quantitative results are equally impressive. The insurance sector’s assets increased by 12 per cent over the past year, surpassing 2.1 billion manat. The sector’s total capital now exceeds risk capital by a factor of two, while profitability has improved significantly. By mid-2025, the sector recorded total profits exceeding 80 million manat, with a return on assets of 7 per cent and a return on equity of 25 per cent. These figures illustrate both financial resilience and growth potential.

For the Turkic World Insurance Union, Azerbaijan’s reforms offer both a blueprint and an inspiration. The ability to embed transparency, efficiency, and innovation into financial institutions sets the stage for greater regional harmonisation.

The TWIU’s formation must be viewed in the broader context of the Organisation of Turkic States’ evolving economic framework. In recent years, intra-OTS trade has grown remarkably. The share of internal trade among Turkic states in total trade turnover has risen from just 3 per cent to 7 per cent, reflecting an intensifying commitment to economic integration. The combined GDP of OTS members now exceeds $2.1 trillion, while trade turnover is estimated at over $1.1 trillion.

This upward trajectory is supported by institutional innovations such as the $600 million Turkic Investment Fund, the Union of Turkic Chambers of Commerce and Industry, the Digital Economy Partnership Agreement, and the proposed Free Trade Agreement on Services and Investments. Collectively, these frameworks point towards a vision of a more self-sufficient and interlinked Turkic economic bloc, capable of competing with other regional groupings such as the EU, ASEAN, and the African Union.

Insurance, in this sense, is the connective tissue that allows these ambitious projects to function effectively. Large-scale infrastructure investment, increased trade flows, and cross-border capital mobility all require sophisticated risk management and reinsurance structures. By institutionalising cooperation in this field, the OTS is laying the foundations for durable growth and resilience.

Global impact beyond Turkic World

While the immediate benefits of the Turkic World Insurance Union are regional, the long-term implications are global. First, the establishment of a coherent insurance and reinsurance framework across the Turkic world will reduce the reliance of these countries on Western financial institutions. This diversification of financial partnerships enhances sovereignty and reduces vulnerability to external shocks or sanctions.

Second, by improving the stability and transparency of financial systems, the Turkic states will become more attractive to foreign investors. Multinational corporations and development institutions alike prefer environments where risk can be quantified and mitigated effectively. A strong regional insurance sector will therefore directly feed into greater foreign direct investment.

Third, the expansion of intra-Turkic economic activity will have spillover effects on global trade patterns. With the OTS controlling critical transport corridors such as the Middle Corridor linking East Asia to Europe, stronger financial systems will only enhance the bloc’s role as a facilitator of global commerce.

Fourth, the inclusion of observer countries such as Hungary demonstrates the Union’s potential to expand beyond purely Turkic states. If successful, the TWIU could become a model for cross-regional insurance cooperation, attracting interest from other neighbouring markets.

The creation of the Turkic World Insurance Union must therefore be interpreted not as an isolated development but as part of a larger mosaic of institutional reforms and economic integration. The Shusha assembly was significant not only because of the Proclamation Document signed but also because it demonstrated a shared determination among Turkic nations to translate cultural and political solidarity into concrete economic strength.

And finally, for Azerbaijan, the meeting reaffirmed its position as a financial reform leader and as a host of strategic regional initiatives. For Turkiye, Kazakhstan, Uzbekistan, and Kyrgyzstan, the Union represents an opportunity to strengthen their domestic insurance sectors while enhancing cross-border financial stability. For observers such as Hungary, the meeting provided a window into a dynamic and fast-growing economic bloc.

Ultimately, the TWIU’s success will depend on the effective implementation of its goals: harmonisation of standards, development of reinsurance structures, digital innovation, and capacity-building. If these ambitions are realised, the Turkic world could emerge not only as a hub of cultural and political cooperation but also as a financial powerhouse with growing influence in global trade.

The Shusha assembly thus symbolised more than a technical insurance meeting; it signalled a shift in the Turkic world’s economic trajectory. As the OTS continues to deepen its integration, supported by institutions such as the TWIU, the coming years may well see the emergence of a new regional power centre with global reach.