About TCIP
By reason of geologic and topographic structure and climate attributes of our country, it is frequently confronted with natural disasters that leads to immense losses of life and property. Natural disasters that affect our country can be put in order according to their severity; Earthquakes, land slides, water floods, rock sliding, fires, avalanches, storms and under ground water movements. Within the past 60 years, when we take into consideration the statistics of the structural damage caused by the natural disasters in our country, it is observed that 2/3 of these damages occur due to earthquake. As a result, in our country when we mention natural disasters, the first thing that comes to peoples mind is Earthquakes. When basing the seismic zones map that is in effect at the present time, 96% of the territories of our country are inside the seismic zones that possess various ratios of risk, and that 98% of our inhabitants are located in these areas. These ratios dramatically reveal the fact that our country is an earthquake country.
The effects of the Earthquakes in our country not only felt in the disaster originated regions but whole country, and therefore all of the residents living in the country are affected by the consequences of an obvious and considerable extent. Compensating the material damages, getting back to regular life in seismic zones, alleviating the needs of those who require emergency assistance, and so on incurred expenditures brings an immense financial burden to the national economy and the state. 17th of August 1999 Marmara Earthquake is the most recent example for this and deemed as the disaster of the latest century, which caused a huge devastation for our country in economic and social aspects.
Subsequent to the Marmara earthquake which took place on 17th of August 1999 and caused loss of thousands lives and properties, great numbers of precautions were taken in order to minimize the damages of Earthquakes by the public authority. On of the most significant precautions is the execution of the Turkish Compulsory Insurance Pool (TCIP).
Within the Marmara Earthquake Emergency Reconstruction Project, World Bank assisted Turkey in designing insurance program to be able to manage it's own national catastrophic exposure. The project consisted of two main objectives; one was technical assistance to the General Directorate of Insurance in establishing TCIP and ensuring sound management of the pool for the first five year of establishment. The second was to porvide initial capital through contingent loan facility. The project was the first World Bank project to to have components of financial risk management, disaster mitigation and emergency prepardnes.
Immediately after the devastating earthquake, on 27.08.1999 Law No.4452 "Measures to be taken Against Natural Disasters and Authorization in Regards to Arrangements to be done in Overcoming the Damages Caused by Natural Disasters Law" was enacted giving three months of provisional authority to the the Council of Ministers to orginise and establish legal framework against natural disasters. Witih this power of authority Decree Law No.587 "Decree Law Relating to Compulsory Earthquake Insurance" entered into force by being published on 27.12.1999 that has given birth to TCIP.
The tariffs and regulations were published on 8th of September 2000 and as of 27th of September 2000, TCIP began offering cover after 9 months of formation process following decree law. Following year on 27th of March 2001, earthquake insurance has become compulsory for the dwellings those subject to compulsory earthquake insurance as described in the decree law. Currently 29 accredited insurance companies and their agents are providing Compulsory Earthquake Insurance in the name and on behalf of TCIP. This newly formed system produced a victorious performance at a short time and proposed as a model solution for many countries by the international organizations.