Turkish Insurance Glossary
Most of the vocabulary on a Turkish policy comes not from everyday language but from the Commercial Code and the general conditions of each line. This glossary gives every term with its source.
The language of Turkish insurance is drawn from the insurance provisions of the Commercial Code and from the general conditions issued for each class of business. What a term means is therefore not a matter of house style; it has a written source. The glossary below sets out the concepts you meet most often on a policy and in a claim file, each with its legal anchor.
Parties to the Contract and Its Documents
Each name on the front page of a policy carries a distinct legal capacity. One person may hold several of them at once, but rights and duties follow the capacity, not the name.
| Term | Meaning |
|---|---|
| Insurance contract (sigorta sözleşmesi) | A contract under which the insurer, against a premium, undertakes to indemnify a loss to a pecuniary interest caused by the occurrence of a risk (Commercial Code art. 1401). |
| Policyholder (sigorta ettiren) | The party that concludes the contract with the insurer and owes the agreed premium (art. 1430). |
| Insured (sigortalı) | The person whose interest in the non-occurrence of the risk the cover is built on. |
| Beneficiary (lehtar) | A third party for whose benefit the contract is made; the interest may be insured with or without naming them (art. 1454). |
| Risk (riziko) | The peril whose occurrence triggers the insurer's duty to indemnify. |
| Policy (poliçe) | The document setting out the parties' rights, the default provisions and the general and any special conditions, drawn up so as to be easily readable (art. 1425). |
| Endorsement (zeyilname) | A document amending the policy mid-term. Provisions in an endorsement that depart from the proposal and operate against the policyholder, insured or beneficiary are void. |
| Premium and insurance charge | The consideration for cover. In compulsory motor liability the charge comprises the premium, the Guarantee Account contribution and the taxes, duties and levies on the policy. |
Sums and Values: The Arithmetic of a Claim
These are the entries that decide the figure paid on claim day. An error here does not remove cover outright — it quietly reduces a substantial part of it.
| Term | Meaning |
|---|---|
| Insurable value (sigorta değeri) | The full value of the insured interest (Commercial Code art. 1460). |
| Sum insured (sigorta bedeli) | The figure written on the policy, capping the insurer's liability (art. 1461). |
| Underinsurance (eksik sigorta) | Sum insured below insurable value. On a partial loss the claim is paid, unless the contract provides otherwise, in the ratio of sum insured to value — the condition of average (art. 1462). |
| Over-insurance (aşkın sigorta) | Sum insured above value. The excess is void; the sum and the matching premium are reduced and the overpayment refunded (art. 1463). |
| Valued policy and agreed value | Value fixed in advance by the contract or by experts chosen by the parties. On a fire policy the valuation list is valid for at most one year and cannot be used for trading stock (art. 1464). |
| Market value (rayiç değer) | The market equivalent of the property on the date of loss. Motor own-damage cover runs up to the vehicle's market value on that date. |
| New value and replacement cost | The cost of rebuilding or buying new, including transport, erection, customs duty, taxes, levies and charges. |
| Deductible (muafiyet) | An amount or percentage agreed in the policy that the insurer will not pay. In kasko policies deductibles must be printed in at least 14-point type. |
Terms You Meet Inside a Claim File
The following concepts surface after a loss rather than at the point of sale, and most of them move the settlement figure directly.
| Term | Meaning |
|---|---|
| Loss adjustment (ekspertiz) | Determining the amount, cause and nature of a loss. The loss adjuster who does this professionally is defined by statute as an impartial and independent person (Law No. 5684 art. 2). |
| Salvage (sovtaj) | The residual, saleable value of damaged property. In kasko, an insurer settling while leaving the damaged vehicle with the insured guarantees the salvage figure it notifies for one month from notification. |
| Abatement (tenzil, tenzilat) | The general name for deductions from the settlement. The Fire Insurance General Conditions reserve the insurer's right to abate for underinsurance, salvage and a marked difference in technology. |
| Total loss of the subject matter (tam ziya) | Complete destruction of the insured property; on a fire policy cover ends when it occurs. |
| Constructive total loss (tam hasar) | In kasko, where repair costs exceed the vehicle's value on the date of loss and an adjuster's report establishes that the vehicle is beyond repair. |
| Interim payment (avans ödeme) | In compulsory motor liability, where investigation is not completed within three months of notification, at least 50% of the loss as assessed is paid on account. |
| Reduction of the sum insured | After a partial loss the sum insured falls by the indemnity paid; it can be restored by paying pro rata premium. |
Subrogation and Recourse Are Not the Same Thing
These two are routinely used interchangeably, yet they point in opposite directions. Subrogation is the insurer stepping into its own insured's shoes, up to the indemnity paid, and pursuing the third party responsible for the loss. Article 1472 of the Commercial Code puts it plainly: the insured's right of action against those responsible passes to the insurer to the extent of the amount indemnified.
Recourse is the insurer recovering from its own insured what it has already paid out. In compulsory motor liability the injured party is protected first — defences that would remove or reduce the indemnity cannot be raised against them. The insurer that has paid may, however, seek recourse against the insured who caused the accident, to the extent that those defences would have removed or reduced the indemnity.
The general conditions list the recourse grounds one by one; the principal ones are set out below.
- The event was caused by the intentional act or gross fault of the insured or of persons for whose acts the insured is responsible.
- The vehicle was driven by someone without the required licence, with an expired certificate or whose licence had been withdrawn, or the accident followed a grossly negligent breach of traffic rules.
- The vehicle was driven under the influence of narcotics or by persons over the alcohol limit set in the legislation.
- Passengers were carried in a vehicle not licensed for them, the carrying capacity was exceeded, or explosive and flammable goods were carried in a vehicle without the relevant permit.
- The loss increased because the duties set out in the general conditions were not performed after the risk occurred.
- In theft or robbery of the vehicle, the insured or persons for whose acts they are responsible were found at fault.
- Except in cases of necessity, the scene was left, or the duty to complete the accident report, alcohol test and similar documents was breached.
Multiple Policies and the Players in the Market
Where the same interest carries more than one policy, the Commercial Code recognises four separate situations, and which one applies changes how payment is shared. The same section gathers the market roles defined by statute.
| Term | Meaning |
|---|---|
| Multiple insurance (birden çok sigorta) | The same interest insured against the same risks for the same period with several insurers; the policyholder is paid no more than the sum insured (art. 1465). |
| Co-insurance (müşterek sigorta) | One interest insured at the same time and against the same risks by several insurers, each liable in the proportion of the sum it has written (art. 1466). |
| Double insurance (çifte sigorta) | Re-insuring an interest already covered for its full value; valid only in the cases and on the conditions listed in the Code (art. 1467). |
| Partial insurance (kısmi sigorta) | Insuring, up to its remaining value, an interest that an earlier contract did not fully cover (art. 1468). |
| Reinsurance (reasürans) | The transfer by an insurer of part of the risk it has assumed to another company; the reinsurance company is separately defined in Law No. 5684. |
| Insurance agency (sigorta acentesi) | The intermediary that brings about insurance contracts, carries out the preparatory work and assists in performance of the contract and in payment of the indemnity (Law No. 5684 art. 2). |
| Broker | An intermediary representing the party seeking cover, acting wholly impartially and independently in the choice of insurer (art. 2). |
| Actuary (aktüer) | The professional who applies probability and statistical theory to calculate premiums, reserves and profit shares and to prepare tariffs and technical bases (art. 2). |
Institutions, Abbreviations and Time Limits
The bodies referred to by abbreviation in policy wordings and claim correspondence each hold a function defined in statute.
| Term | Meaning |
|---|---|
| SEDDK | The Insurance and Private Pension Regulation and Supervision Agency, which issues the general conditions and sector rules. |
| Levha (registry) | The register of active agencies and loss adjusters kept by TOBB, and of companies kept by the Association (Law No. 5684 art. 2). |
| Guarantee Account (Güvence Hesabı) | An account held at the Association to meet bodily injury up to the valid limits of compulsory liability insurance where, for example, the insured cannot be identified or the vehicle was uninsured (art. 14). |
| SBM | The Insurance Information and Monitoring Centre, where sector data is collected and shared with authorised persons (art. 31/B). |
| DASK | The Turkish Catastrophe Insurance Pool, which operates Compulsory Earthquake Insurance. |
| Insurance Arbitration Commission | The commission established at the Association to resolve insurance contract disputes through arbitrators (art. 30). |
| Limitation (zamanaşımı) | Claims under an insurance contract are time-barred two years from the date the receivable falls due, and claims for indemnity or the sum insured in any event six years from the occurrence of the risk (Commercial Code art. 1420). |
| No-claims discount (hasarsızlık indirimi) | A discount granted by special conditions. The Kasko General Conditions require the terms governing such discounts and benefits to be stated on the policy. |
Does Knowing the Terms Mean You Can Read the Policy?
A glossary is a good start, but a policy is a balance sheet rather than a piece of prose. The same word can produce different outcomes across classes: average prorates a fire claim yet does not apply to kasko, because kasko is written on a market-value basis.
General conditions form the fixed spine of the policy; special conditions are built on top of them. The Kasko General Conditions state expressly that special conditions may be added only where they do not operate against the insured. So when you look for the meaning of a term, read the general conditions of the relevant class first and the special conditions of your own policy second.
RYL Sigorta Aracılık Hizmetleri Limited Şirketi operates as an insurance agency. We prepare quotations from the insurance companies we act for and put items such as deductibles, sums insured and valuation basis in plain terms before the policy is issued. Indemnity is paid by the insurance company. If you would like to go through a term on your own policy, reach us through the quotation form.
Frequently Asked Questions
Is a Deductible the Same as an Abatement?
No. A deductible is an amount or percentage agreed in advance in the policy that the insurer will not pay. Abatement is the general name for deductions made from the settlement — the average ratio, salvage value and a marked difference in technology all sit under that heading. Both can apply to the same claim.
What Is the Difference Between Subrogation and Recourse?
In subrogation the insurer steps into its own insured's shoes up to the indemnity paid and pursues the third party responsible (Commercial Code art. 1472). In recourse the insurer recovers from its own insured; in compulsory motor liability that right is limited to grounds that would have removed or reduced the indemnity, and the injured party's rights are preserved.
Who Sets the Salvage Figure?
In kasko, an insurer that wishes to settle while leaving the damaged vehicle with the insured notifies the salvage figure it has assessed and is deemed to guarantee that figure for one month from notification. On a fire policy salvage is one of the items abated from the settlement.
Do the Kasko General Conditions Provide a Courtesy Car?
The Land Vehicles Kasko Insurance General Conditions do not regulate replacement-vehicle cover. It is added to the policy as an extension or clause, and its scope, daily limit and duration appear in the special conditions. That line should be read before the policy is bought.
What Is the Limitation Period on an Insurance Contract?
Under article 1420 of the Commercial Code all claims under the contract are time-barred two years from the date the receivable falls due, and claims for indemnity or the sum insured in any event six years from the occurrence of the risk. In compulsory motor liability, claims are barred two years from knowledge of the loss and the person liable and in any event ten years from the date of the accident.
Sources
- Turkish Commercial Code No. 6102 — Legislation Information System
- Insurance Law No. 5684 — Legislation Information System
- Fire Insurance General Conditions
- Land Vehicles Kasko Insurance General Conditions
- Compulsory Motor Third Party Liability Insurance General Conditions — Legislation Information System
- Insurance General Conditions — SEDDK
This article is for information only; the scope of cover is set by the policy’s specific and general terms.
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