Turkish Catastrophic Insurance Pool (TCIP/DASK in Turkish) has managed to increase the number of residences with insurance coverage above 9 million on the 20th anniversary of Marmara Earthquake, which occurred on 17 August 1999. Rate of residences with earthquake insurance coverage has therefore climbed up to 52 percent.

İsmet Güngör, Coordinator of TCIP, evaluated the performance of compulsory earthquake insurance on the 20th anniversary of Marmara Earthquake. He underlined that they wished for a Turkey that is 100 percent insured against earthquake. İsmet Güngör said:

“TCIP has significantly increased the insurance rates thanks to our efforts since 2000. After the Catastrophe Insurance Law -which came into force on 18 August 2012- obliged the ownership of a compulsory earthquake insurance policy for utility transactions as well as mortgage and title deed transactions, insurance rates have increased considerably. Number of residences with earthquake insurance was around 500 thousand in 1999, which has exceeded 9 million today. After the issuance of this legal obligation, most of the compulsory earthquake insurance policyholders have met with insurance for the first time in their lives.” 

One out of two people believes they live in a low-risk zone

According to the recent perception research conducted by TCIP using survey and in-depth interview methods, one out of two people defines the region of their houses as a secure zone. Seven out of ten people believe that their homes are solid even if they haven’t had it checked.

Stating that they reached more than 9 million residences and managed to get one of two residences under insurance coverage, Güngör said:

“We have gained half of the residence owners. Now is the time to gain the other half. Increasing the number of insured residences is also in the 11th Development Plan. The results of our recent research indicate that home owners that have not bought compulsory earthquake insurance prefer to ignore the risk rather than managing it. Half of the home owners believe that they are safe, and this belief is not grounded on any information or precaution. They do not want to face the risks. The idea that nothing would happen to them is dominant. We should tell them about the earthquake risks, show them that they are not helpless against it, and persuade them to buy earthquake insurance and take necessary precautions. Because life will continue after the earthquake, and insurance will have great importance in turning our lives back to normal much faster.”

A new generation that has not experienced 17 August has grown up

We see that cities that have experienced the earthquake have the highest rates of compulsory earthquake insurance ownership. Düzce, Yalova and Sakarya have a rate over 80 percent; and Tekirdağ and Muğla are at around 70 percent. As to the big metropolises, earthquake Insurance ownership rate reached 62 percent in İstanbul, 57 percent in İzmir, 55 percent in Ankara, 54 percent in Antalya.

Underlining that the earthquake experience has deeply influenced the insurance rates of cities, Güngör added as follows:

“August 17 Marmara Eartquake was a great destruction and suffering for our country. TCIP was founded in 2000 with the aim of providing coverage for financial losses in residences that might be caused by earthquakes, and to ensure the continuity of living circumstances after the earthquake. However, the research indicates that during the 20 years that have passed after this major earthquake, the risk of earthquake has fallen behind other risks according to the risk perception of individuals. We have a new generation that has not experienced this earthquake. Today, our mission is to tell them about the earthquakes and necessary precautions before they suffer from a similar fate.

Nearly 200 million TL paid in claims for 20 years

Stating that 651 damage-causing earthquakes have occurred since the foundation of TCIP, Güngör said: “We have paid nearly 200 million TL for small, medium and large-scale losses caused by those earthquakes in residences that have compulsory earthquake coverage. After Van Earthquake, we started paying for claims in a very short time and paid a total of 135 million TL.”

TCIP’s claims paying ability increased to 20 billion TL

Being monitored closely on international platforms, TCIP is regarded as a model for other countries due to number of its policies, achievements in increasing the insurance rate, its ability to offer insurance coverage with low premiums, its high claims-paying ability that includes reinsurance and catastrophe bond, and its successful business model as a public-private partnership. TCIP’s claims-paying ability against a major earthquake has reached 20 billion TL thanks to its accumulated reserves and reinsurance capacity.

Expressing that TCIP’s achievements make them proud, Güngör said: “Our projects that aim to manage our pre-earthquake operations and post-earthquake claims process have not only yielded successful results in Turkey, but also received a great deal of attention from many other countries. We are proud to be sharing our experiences about compulsory earthquake insurance on behalf of both our organization and our country.”

TCIP’s works and projects in Turkey have become a model for many countries, particularly for countries like Pakistan, Iran, South Korea, Kazakhstan, Azerbaijan, Uzbekistan, Mongolia, and Romania; and the organization has shared their experiences and details about compulsory earthquake insurance in several countries including the United Kingdom, Japan, Greece, Italy, Philippines, China, Mexico, Macedonia, Jordan, Morocco, Albania, Indonesia, Romania, Kuwait and Azerbaijan.