HOW TO DEAL WITH THE CONSEQUENCES

OF EARTHQUAKES

BİLAL TÜRKMEN
TCIP Deputy General Secretary
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CONTENT______________________________________________________________________

1 BACKGROUND, STRUCTURE AND PRODUCT

2 ACHIEVEMENTS

3 CAT MANAGEMENT

1 CAT FINANCE

2 CAT OPERATION

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GÜNDEM

1 BACKGROUND, STRUCTURE AND PRODUCT

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DISASTER FINANCE IN 2000_____________________________________________________

Disaster housing finance through budget

High external borrowing

High internal public debt

Tax increases

Low earthquake insurance penetration < 4%

Low insurance payment due to earthquake: $800 million

Low insurance awareness

Insurance perceived as an extra spending

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DESIGN AND OBJECTIVES______________________________________________________

By examining the examples from the world, the best fit and tailor made system was
created according to the Turkey conditions.

Residential earthquake insurance scheme: Compulsion through checkpoints

TCIP: Sole provider of the new product

Risk based affordable price

True risk transfer mechanism

Reliable distribution channels through insurance industry

Creating insurance capacity to limit government exposure

Building up catastrophe reserves over time

Improvement of risk culture and insurance awareness in public

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UNIQUE ORGANIZATIONAL STRUCTURE__________________________________________

HOUSEHOLDERS
RISK
Simple/lean organization MANAGEMENT
BEHAVIOUR

Public-Private-Partnership
Low operational cost
Low distribution cost
Adherence to insurance principles
Obtaining strong political and
regulatory support
TCIP
TREASURY
Embracing all stakeholders MANAGEMENT COMPANY

INSURERS AUTHORITIES
SALES LEGAL FRAMEWORK,
OPERATION SUPERVISION,
RISK MANAGEMENT SUPPORT ESTABLISHING
CHECK POINTS,
DISASTER MANAGEMENT

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PRODUCT AND LEAN DESIGN ________________________________________________

Product concept Singularity Product feauture Simplicity

Line Peril Risk Provider Understanding Access Pricing Click Post-sales

Product Operations

Property Earthquake Residential DASK Few

Only All 3 pricing
Buildings Information Just Call
Earthquake Channels factors
requirements 125

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GÜNDEM

2 ACHIEVEMENTS
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A GLOBAL ROLE MODEL________________________________________________________

STRONG RESERVES INCREASED PUBLIC

SUSTAINED LOW PRICES IMPROVED PENETRATION
AWARNESS

LESS THAN FROM OVER OVER

90%
US$ 25 4% TO 52% US$ 1.5 BILLION
BRAND AND PRODUCT

RECOGNITION
ANNUAL PREMIUM
RELEASE ON EFFECTIVE PUBLIC-PRIVATE-
LOW OPERATIONAL COST MARKET DEVELOPER
NATIONAL BUDGET PARTNERHIP STRUCTURE

2ND
LOB
HAS BECOME

US$ 4 BILLION
LESS THAN
9,1 MILLION 6 .3 MILLION
EARTHQUAKE HOMEOWNER
A GLOBAL
CLAIM PAYMENT CAPACITY 2% POLICIES ROLE MODEL

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REGIONAL PENETRATION & POLICY PREMIUMS____________________________________

44%
İSTANBUL
%62
62%

$ 22 $
727.063 39%
$ 28 $
3.583,775 48%
53%
$ 30 $
297.218

$ 13 $
$
31 $ 37%
1.579.162
1.310.062 45%

$ 20 $
$ 23 $ 351.789
971.494

52%

AVERAGE PREMIUM - USD

$ 25 $
NUMBER OF POLICIES 9.100.000

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 NEXT HORIZON ______________________________________________________________ 12

INCREASING IMPROVING CAT

PENETRATION MANAGEMENT

FINANCIAL OPERATIONAL
MANAGEMENT MANAGEMENT

9,1 MILLION 100 % ROBUST CONTINGENCY IMPROVING

POLICIES COVERAGE PLATFORM RESOURCES COORDINATION

EFFECTIIVE USE OF USE OF IMPROVED METHODOLOGIES AND RISK

CHECK POINTS REDUCTION STUDIES

DIGITAL BRAND FOR CAT OPERATIONAL MANAGEMENT

STRONG COORDINATION WITH STAKE HOLDERS AND CONTINOUS

COVERAGE PUBLIC RELATION ACTIVITIES

SUCCESS

PENETRATION OPERATION

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DYNAMIC MANAGEMENT OF THE PROGRAM ______________________________________
GROWING RESERVES: DECREASING COSTS

๏
70,1% 7,9%
๏
Europe Asia

6,1%
4,6% England

๏
USA

5,2% 1,3%
Turkey
Bermuda
4,3%
Middle East

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ASSESMENT OF CAT OPERATIONS ______________________________________________

1
LOSS ASSESSMENT
PROCESS Brokers
3
OPERATION CENTER
MANAGEMENT 4
๏
OPERATION
Pool’s
Management COORDINATION
3.5 mil. - MANAGEMENT

๏
Compnany

Minister of Treasury and

Finance
+2.75 mil.
Operation Center
~ 3.000 Insurance Assocıatıon of

๏
Turkey
Insurance Companies
2 Çağrı
4 mil. ~ 4.500
AFAD
Environment And Urbanization
LOSS ADJUSTER

๏
Merkezi
TOBB
MANAGEMENT
+2.75 mil. ~ 1.500 ~250.000
๏ ~ 3.000 ~ 150
Loss Adjusters Executive Board
~
๏550
AKOM
Governorates, Municipalities ve Local Authorities
Call Centers
~ 500 Transportation Companies
~ 15
Telecommunication Companies
Catering Firms
Hotels
Security Firms
Cargo and Courier Firms
Mobil Banc Transactions

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 TCIP CAT MANAGEMENT_______________________________________________________ 15

UPCOMING PROJECTS
• Crisis management immediately after
earthquake CLAIM MANAGEMENT IT STRUCTURE
• Improving coordination & integration
• Disaster Management System (AYS)
with Government Stakeholders
software which was started to be
• Mobile devices field management developed in 2014 in SAP Loss
• Defining procedures to evaluate claim module, were put into practice as of
files the fastest way possible and 2016
creating contingency resources to
evaluate claim files.
TARGET: Examine and conclude a loss
file in ONE MINUTE»

NATURAL DISASTER
CONTINGENCY OF LOSS RISK MANAGEMENT SYSTEM
ADJUSTER RESOURCE & (ARYS)
NATIONAL LOSS ASSESSMENT ALMOST DONE • For purposes of facilitating the
STEP 3 STEP 1 (B)
METHODOLOGY DONE operations management and planning
efforts, a multi functional decision
• Using technical staff of the support system has been developed.
Ministry of Environment and
Urbanization incase of a big
earthquake.
• Common methodology for
building loss adjustment MOBILE LOSS ASSESSMENT
among the institutions who are APPLICATION
on the field after an • Loss assessments to be made solely
earthquake. through the Mobile Loss Assessment
Application in the upcoming period
• For rapid claim assessment, a simple
DISASTER CALL CENTER methodology developed for determining
structural damages
• The Disaster Call Centre project is a • To control costs centrally 22K cost
model study made for an earthquake, recipes loaded into the software
the time, place and scale of which are
uncertain but the loss effects of which
are not possible to be ignored

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MANAGING CLAIM PROCESS ____________________________________________________

CAT RESPONSE LOSS ASSESMENT/CLAIM

PLAN MANAGEMENT

START EARLY LOSS

ASSESMENT

PR AND
๏
๏
COMMUNICATION NOTIFICATION

๏
EARLY
ASSESMENT – ADJUSTER

๏
FINANCIAL LOGISTICS
OPERATION MANAGEMENT

RESOURCE MANAGEMENT
ANALYSIS

APPOINTMENT ADJUSTMENT
๏
๏
COMMUNICATION
WITH PARTNERS
VALUATION
๏
COORDINATION
WITH FINANCIAL APPROVAL
INST

COORDINATON
WITH PUBLIC PAYMENT
OFFCICES

REPORT/COMPLAIN/
FOLLOW UP PERFORMANCE
MANAGEMENT

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CREATING NATIONAL RESOURCES IN DISASTER FINANCE__________________________

Call Center

Required Call Center Agents

in 7.week.

Different Locations other than

headquarter.

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๏ ๏ ๏
๏
๏
๏ ๏ ๏

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BENEFITS OF GIS FOR EARTHQUAKE MANAGEMENT ______________________________
GIS FOR PLANNING AND OPERATION POLICY INTENSITY MAP

WHY AND HOW TO INTEGRATE GIS TECHNOLOGIES

BEFORE

T -1
EARTHQUAKE MODELLING
IMMEDIATELY
AFTER

T0
ESTIMATION
EARTHQUAKE
SHORTLY AFTER

T1
EARTHQUAKE DESKTOP LOSS ASSESMENT

EARTHQUAKE

T2
OPERATION CLAIM ADJUSTMENT

AFTERSHOCKS

T3
TRACKING THE FIELD

LANDSLIDE EXPOSURE MAP LIQUAFACTION EXPOSURE MAP

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GIS FOR LOSS ESTIMATION AND OPERATIONAL USE ______________________________

BEFORE EARTHQUAKE: USE SCENARIOS FOR LOSS MODELING AFTER EARTHQUAKE: RUN EVENT
PARAMETERS FOR LOSS ASSESMENT

WHY AND HOW TO INTEGRATE GIS TECHNOLOGIES

BEFORE

T -1
EARTHQUAKE MODELLING

IMMEDIATELY

T0
AFTER ESTIMATION
EARTHQUAKE
SHORTLY AFTER

T1
EARTHQUAKE DESKTOP LOSS
ASSESMENT
EARTHQUAKE

T2
OPERATION CLAIM ADJUSTMENT

T3
AFTERSHOCKS TRACKING THE FIELD

FINANCIAL/OPERATIONAL FINANCIAL/OPERATIONAL
LOSS ANALYSIS LOSS ANALYSIS

FINANCIAL CAPACITY PLANNING OPERATIONAL CAPACITY PLANNING

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CONTINGENCY CAPACITY MANAGEMENT _________________________________________

WHY AND HOW TO INTEGRATE GIS TECHNOLOGIES

MODELLING

T -1
BEFORE EARTHQUAKE

IMMEDIATELY AFTER ESTIMATION

T0
EARTHQUAKE

SHORTLY AFTER DESKTOP LOSS ASSESMENT

T1
EARTHQUAKE

EARTHQUAKE CLAIM ADJUSTMENT

T2
OPERATION

AFTERSHOCKS TRACKING THE FIELD

T3
๏

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CHANGE DETECTION AND POST PROCESSING MANAGEMENT ______________________

URBAN CHANGE DETECTION USING SATELLITE IMAGES TO SUPPORT RAPID EARTHQUAKE DAMAGE ASSESSMENT
WHY AND HOW TO INTEGRATE GIS TECHNOLOGIES

BEFORE

T -1
MODELLING
EARTHQUAKE

IMMEDIATELY AFTER ESTIMATION

T0
EARTHQUAKE

SHORTLY AFTER EXCEL ON

T1
EARTHQUAKE DESKTOP LOSS ASSESMENT

EARTHQUAKE CLAIM ADJUSTMENT

T2
OPERATION

AFTERSHOCKS TRACKING THE FIELD

T3

Disaster preparedness (pre-disaster)

Analysis of the financial risk exposure
Determination of the resource needs for disaster response
Planning of the response operations
Disaster response (post-disaster)
Quick determination of the extend of the damage
Organization of the disaster response teams
Supporting claim management operations

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