Selva Eren, CEO of Türk Reasürans AŞ, which carries out the technical operations of the Turkish Catastrophe Insurance Pool (TCIP), has disclosed that claims payments were made within 24 hours of the devastating earthquake that recently struck the country.
On February 6, 2023, an earthquake with a magnitude of 7.7 occurred near Pazarcık in Kahramanmaraş, triggering another earthquake with a magnitude of 7.6 with an epicentre in Elbistan and a series of other aftershocks.
Eren states that emergency disaster management procedures were initiated within minutes of the earthquake, and TCIP claims operations were transferred to the Disaster Management Center in Ankara in accordance with procedures.
A mobile field office with the pre-designated staff was then set up in the disaster area the day after the earthquake, with the first claims received from the call centre and digital channels from the first day.
Eren notes that experts and loss adjusters were mobilised within the first few days, and the first claims payments were made within 24 hours of the earthquake.
Reinsurers were notified with a preliminary information package within the first week.
TCIP previously increased its claims payment capacity to 117 billion Turkish Liras (based on possible worst-case scenarios) through the combination of TCIP’s existing resources (accumulated funds of the pool), structured solutions funds and the reinsurance protection.
Commenting on this, Eren said, “The significantly increased payment capacity enables TCIP to make initial claims payments to policyholders whose homes have been severely damaged.
“TCIP has the necessary operational capability and financial strength to meet its commitment to the policyholders during these difficult days.”
She continued, “TCIP and Türk Reasürans are very grateful to the global reinsurance communities for their deepest condolences and support for our tragic losses caused by this earthquake.
“We are actively working with our business partners and running simulations to get an estimate of the insured losses, which will be released.”
The full impact of the devastation will take some time to register, though analysts at the Turkish Disaster and Emergency Management Presidency (AFAD) recently reported that 31,643 people have lost their lives in Kahramanmaraş, Gaziantep, Şanlıurfa, Diyarbakır, Adana, Adıyaman, Osmaniye, Hatay, Kilis and Malatya and Elazığ.
A further 158,165 people have been evacuated from quake-hit areas.
According to Verisk’s Extreme Event Solutions, the earthquakes are expected to drive economic losses of more than $20 billion, of which insurers and reinsurers will cover more than $1 billion.
Bill Churney, President of Extreme Event Solutions, said, “The sizable difference between insured and economic losses—the protection gap—represents the cost of catastrophes to society, much of which is ultimately borne by governments. Increasing insurance penetration can ease much of the burden.
“There are solutions available that can enhance global resilience efforts including, emergency management, hazard mitigation, public disaster financing, risk pooling, and other government-led risk- and loss-mitigation initiatives.”
