However, due to the ever-changing conditions in the financial markets, these instruments have further been used for speculative purposes and arbitrage opportunities. Nevertheless, this paper focuses on the influence of derivative usage for hedging purposes on the profitability of firms in the Turkish nonlife insurance industry. The data consists of 25 non-life insurance companies operating in Turkey from 2009 to 2019, inclusive. The findings based on panel data analysis reveal that derivative usage contributes to the firms’ financial performance measured by return on assets (ROA) in that firms that use derivatives demonstrate a 5% higher ROA figure in comparison to non-users.