Types of vehicle insurance

There are two types of “vehicle insurance”s in Turkey:

1. “Compulsory Financial Liability Insurance”, also known as “trafik sigortası”
2. “Discretionary Financial Liability Insurance”, also known as “kasko”.

Vehicle insurance is also known as car insurance, motor insurance, or auto insurance.

As the names would suggest, both types of vehicle insurances are liability (responsibility) insurances.

As the coverage extent of the Compulsory Financial Responsibility Insurance is limited, Traffic Code Art.100  permits Discretionary Financial Responsibility Insurances. The injured party may directly appeal to the insurer or file a suit at the courts.

The insurer is liable to third parties just as the operator. This liability is derived from Traffic Code Art.91.

Do insurance companies pay damages to individuals hurt in car accidents?

Under the terms of a Compulsory Financial Responsibility Insurance (CFRI), the insurer of the faulty operator of the vehicle is responsible for all damages in accidents within the limit set by the policy valid at the time of the accident. In other words, in the event of injury or death caused by the operation of the insured vehicle, the insurer insures and covers the responsibility of the operator within policy limits set by the Traffic Code(n. 2918).

CFRI only covers the material damages. Immaterial (mental anguish) damages are not within the scope of the insurance.

According to the Traffic Code Art.91, all vehicle operators are obliged to insure their vehicles with a CFRI. Failure to comply results in a ban from traffic.

What is the compensation (damages) for damage (that descendants can claim) in a case of death in a traffic accident?

In a case of death in a traffic accident, as the inheritors are deprived of the deceased’s support, they may demand deprivation of support indemnity, burial and funeral costs, and also mental anguish indemnity due to mental pain and suffering from the deceased’s death.

Drivers Liability – In the case of traffic accident, to whom is the driver liable for material and immaterial damages (passengers, third parties, the ones involved in car accident)?

Material damages (in case of damage to the vehicle & the driver is faulty/wrongful): The driver is liable to the owner of the vehicle. If the owner has died in the accident, then the driver is liable to the heir of the owner. If the vehicle is insured and the damages are covered by the insurance company, then the driver is responsible to the insurance company.

However, in the event that the vehicle used by the faulty driver is insured with a Compulsory Financial Responsibility Insurance, the damages are covered by the insurance company within the limits of CFRI policy. For damages that exceed the CFRI limit, the damages are covered from the Discretionary Financial Responsibility Insurance (DFRI), if any. If there are no DFRI, the faulty driver is responsible with his own personal wealth for the damages that exceed the CFRI limit.

Immaterial damages: The faulty driver is liable to immaterial claims from the relatives of the injured or deceased. As a rule, insurance companies that are party to a DFRI or CFRI are not liable to immaterial claims. Insurance companies may only be liable to immaterial claims if this responsibility is explicitly stated in the policy, which is rarely the case.

If the faulty driver is deceased in the accident: The heirs of the driver are liable to these claims, unless they have refused the inheritance. In this case the insurance warranty is still valid.

If the vehicle driven by the driver is not insured with a CFRI: The Assurance Account of the state covers the treatment costs for all bodily damages. This is a state-run insurance account.

How and from whom can one claim damages for suffered immaterial damage (such as mental anguish)?

Immaterial damage can be claimed from whomever is alleged to have caused the mental anguish. It can be claimed through a suit, either as a separate immaterial damages suit, or together with a material damages compensation suit. Naturally, the claim has to be proven and oftentimes does not succeed too easily. Also the amounts decided by the courts for immaterial damages are usually low, due to two main reasons: the compensation may not be too high to affect the responsible party’s financial status and the compensation may not cause unjust enrichment on the part of the mentally damaged. As a result, Turkish courts are reluctant to rule on immaterial damages as high as the equivalents in other western countries.

Do the injured parties usually claim the damages alone (by them self) or through the lawyer or a third party?

The injured parties may claim the damages by themselves, or through a lawyer. It is not common for the parties to claim damages by themselves, so the common practice is to either claim the damages through a lawyer.

How does one enforce the damages?

It is not compulsory to file a case (through judicial proceedings) to enforce the damages.   One may seek damages through a written application to the insurance company before filing a case. In the event that the application is denied by the insurance company, one may then file a suit within the legal time frame.

If the application is accepted but there are disputes on the amount of the damage, then the case may be brought before the court.

Alternatively, one may directly seek damages through filing a case at the court without ever applying to the insurance company.

What are the limits for compensation claim for material and immaterial damages?

The limit for compensation claims for material damages is the actual damage incurred. Therefore one cannot receive compensation higher than the actual damage, otherwise an unjust enrichment would occur. The amount of the actual damage (therefore the material claims) are almost always determined by experts.

There are no limits for immaterial damages but the damages decided by Turkish courts are usually much lower in comparison to other western countries.

What is the compensation for the damages in case of the death of a close relative?

In the event of the death of a relative or a close friend, one who suffers from mental grief due to this event may claim immaterial damages. Please note that it is not required to be a family member in order to make such a claim. Anyone who was a relative or a friend of the deceased who thinks that she/he has been subject to mental anguish or grief may make this claim.

There is also another type of damage that may be claimed in such an event, namely the damage due to destitution of support. It may be claimed by anyone who had been financially supported by and dependent on the deceased person. However sons over the age of eighteen cannot claim this type of damage due to the death of their parents. Similarly, married daughters cannot claim damages due to destitution of support. Employment status of the claimant is irrelevant in both cases.