The Circular on the Implementation of paragraph 4 of Article 15 of the Regulation on Tariff Implementation Principles in Compulsory Financial Liability Insurance of Highway Motor Vehicles (“Circular”) has been published by the Insurance and Private Pension Regulation and Supervision Agency (“Agency”) on 23.01.2023.
New paragraphs were added to the Regulation on Tariff Implementation Principles in Compulsory Financial Liability Insurance of Highway Motor Vehicles with the Amendment Regulation published in the Official Gazette dated 12.08.2022 and numbered 31921. With this amendment, the Agency shall have the authority to temporarily suspend the policy issuance and renewal authority of insurance companies’ insurance branches determined by the Agency or all its insurance branches determined to have avoided issuing policies, for a period of minimum 3 days and maximum 30 days.
The acts of avoidance from issuing a policy specified in the circular are as follows;
- In the traffic insurance, a decrease of 20% or more in the number of policies issued in previous year compared to average number of policies issued in the last 3 years. Traffic insurance policies issued in 2022 shall not be considered in determining the number of policies for comparison for the last 3 years.
- In the traffic insurance, a decrease of 30% or more in the number of policies issued in the last 3 months compared to the average number of policies issued in the same period of the last 3 years. Traffic insurance policies issued in 2022 shall not be considered in determining the number of policies for comparison for the last 3 years.
-Violation of the above-mentioned acts shall not constitute avoidance for companies with a share of 50% or more of gross premium production in land vehicles liability branch in total gross premium production.
- In the traffic insurance, a decrease of 30% or more in the number of the policies issued in the last one month compared to average monthly number of the policies issued in the last 3 months.
- In the traffic insurance, a decrease of 40% or more in the number of policies issued in the last week compared to the average number of policies issued in the last 3 months.
- The number of traffic insurance policies issued in the last 1 month and in the last 1 week in the tariff steps of the table in the Circular remains below the rates specified in the table compared to the number of traffic insurance policies issued in the 7th step of the same period.
- The number of traffic insurance policies issued in the last 1 month and last 1 week for corporate type motor vehicles remaining as 7% and 42% below the number of traffic insurance policies issued in the same period for private use type motor vehicles, respectively.
- The ratio of the number of insurance policies issued by the insurance company in the last 3 months to the number of traffic insurance policies issued throughout the sector is 40% or less of the ratio of the number of policies issued by the insurance company in the motor insurance branch to the number of policies issued throughout the sector in the same period. The first monitoring within the scope of this act shall be made 3 months after the publication of the Circular.
Monitoring other than the following regarding the detection of avoidance shall be made by the Insurance Information and Monitoring Center. In the audits, it shall be determined whether:
- The bidding process of the traffic insurance policy premium has been extended or not terminated in a reasonable amount of time and
- The collection process for the traffic insurance policy has been extended or not terminated in a reasonable amount of time.
Policies issued as of 01.01.2023 shall be considered in determining the number of policies. Moreover, policies within the scope of risky insurance pool and policies canceled out due to thei own nature shall not be taken into account in determining the number of policies.
You can access the full Turkish text of the Circular via the link below.
https://www.seddk.gov.tr/upload/Duyurular/2023-3%20Sayili%20Genelge.pdf
