TURKEY: new standardized calculation method introduced for the MTPL claims starting 1 April

25 March 2020 — Daniela GHETU
As of 1 April, new provisions introduced in the general rules related to compulsory MTPL will take effect, providing for standardized criteria for the compensations calculation, a recent press release of the Insurance Association of Turkey (TSB) has announced.

The new calculation method takes into account previous judicial decisions relating to motor insurance compensation and provides for a unitary approach in the compensations calculations, including depreciation calculation and establishing the value of compensations for bodily injuries. In addition, the list of documents requested for processing accident compensation payments was also made clearer.

TSB president Atilla BENLI said:

"Until today, the lack of full clarification in the regulations on compensation calculations led to disputes between the beneficiaries and insurance companies, and especially the disputes in the compensation of the bodily injuries were transferred to the judiciary."


In fact, this situation was harming both the insured interests - by delaying the payment of the compensations until a court decision was in place-, and the insurers' financial results, causing higher claims expenses and lack of predictability. In the end, it was also increasing the pressure on insurance premiums, affecting the over 23 million Turkish vehicle owners.

"In this context, we think that the changes will create a structure that ensures standardization in compensation calculations and timely compensation payment to our policyholders, and that our industry will achieve a sustainable financial structure," BENLI pointed out.


A calculation method based on objective criteria was introduced for the loss of value calculation, hopefully minimizing insurance disputes. The loss of value of vehicles will be calculated, using simple tables based on the vehicle's fair value, the extent of damage to the vehicle and the vehicle's mileage by insurance experts. In addition, equivalent motor parts will need to be certified, and a minimum 20% local content rate will be required.

A new calculation method has been also prepared and added to the general conditions, considering the previous judicial decisions, for calculating the lack of support and permanent disability compensation.





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