Page 9 - Turkinsurance Digital Magazine

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3rd grade as well as commercial taxis, minibuses, coaches, trucks authority to increase or decrease those rates by 20 points.
and tow trucks in the 4th, 5th, 6th and 7th grades are included in
the scope of traffic insurance pool. Premiums and losses accumulat- Principles of participation (takaful) insurance deter-
ing in the pool will be distributed among insurance companies based mined
on a two-phase calculation. 50 percent of premiums and losses paid
will be distributed equally among the companies, while the remain- The purpose of the Regulation on the Procedures and Principles
ing 50 percent will be calculated based on their share from traffic of the Participation Insurance, which was issued on 20 September
insurance premiums received in the last three years.
2017, was to ensure the functioning, development, healthy monitor-
ing, and reliability of the system as well as guarding the rights and
E-application in insurance benefits of the participants. Companies to engage in participation
insurance activities will invest the accumulations of participants in
interest-free financial tools. Insurance companies in this system will
On 19 July 2017, Undersecretariat of Treasury issued the Circular operate in proxy, mudarebe (share of profits based on labor-capi-
on the E-Application System in Insurance. With this circular, insur- tal partnership) models, hybrid model of the two, or another model
ers are obliged to respond to all manner of information requests re- to be approved by the audit committee. Insurance companies will
garding the contract which were conveyed as insurance complaints administer the risk fund consisting of participant contributions and
by the policyholder or their beneficiaries via written or electronic funds of shareholders and members separately. They will administer
communication tools – including the payments to be done in accord- a “participant investment fund” that includes the premium payments
ance with the contract – within 15 business days after receiving the of participants made with saving purposes and the revenue generat-
request. Therefore, in order to fulfill their obligations arising from ed from those payments via the tools of participation finance. Ac-
this regulation, the insurer must establish a complaint team of at cording to the conditions set forth in the Insurance Law, insurance
least 2 people to work for evaluating and resolving the complaints companies will be able to employ the ‘window model’ which means
and information requests, and share the logs, records and statistics they can offer participation insurance products to their customers
of all complaints with the Undersecretariat on a quarterly basis. In without founding a separate company. Operations of such compa-
this context, insurance and pension companies and other institutions nies will be limited to 3 years after the regulation comes into force.
conducting insurance related activities will be receiving applications Price cap system continues
and complaints and responding them via E-devlet platform.
The Circular on the Premiums of Motor Vehicles Compulsory Third
Price cap increase Party Liability Insurance for 2018 was issued on 25 December
2017. This latest circular of 2017 stipulates that the price cap lim-
On 1 September 2017, another circular was issued to make an itation will continue to be applied between 1 January 2018 and 31
amendment to the Circular on the Premiums of Motor Vehicles December 2018. Moreover, maximum premium amounts from De-
Compulsory Third Party Liability Insurance. The new circular stip- cember 2017 will be increased by 5 percent with the beginning of
ulated that the maximum premium amounts would be increased by 2018.
1.5 percent on a monthly basis.

Pool model for the medical liability insurance

According to the Sectoral Announcement Regarding the Compul-
sory Medical Malpractice Liability Insurance, which was issued on
6 September 2017, principles for sharing the premiums and losses
were determined in order to prevent problems about companies not
drawing policies for compulsory medical malpractice liability insur-
ance. The regulators decided that Güneş Sigorta would conduct the
transactions for premium and loss sharing as a company licensed in
the general liability branch. In accordance with this arrangement
that provided coverage for policies issued before 1 July 2017, an
audit committee shall be established consisting of 3 representa-
tives from Undersecretariat of Treasury, Insurance Association of
Turkey, and Güneş Sigorta. 50 percent of the premiums and losses
paid will be distributed equally to companies in the pool; while the
remaining 50 percent will be distributed based on the share they
received from the premiums of compulsory medical malpractice li-
ability insurance in the last 3 years. Undersecretariat will hold the
Zeynep Tütüncü / zeynept@bestyayincilik.com