Turkish cat pool to cover 'substantial' insured losses from latest quake: Aon

By Rebecca Delaney

Aug 15 - (The Insurer) - Insured losses from the magnitude 6.1 earthquake that struck western Turkey on August 10 may be "substantial" owing to the relatively high take-up of the Turkish Catastrophe Insurance Pool (TCIP) in the affected provinces, according to Aon's weekly cat report.

The earthquake occurred at a depth of 10 km (6.2 miles) in the Sindirgi district of Balikesir province in western Turkey, with the epicentre located approximately 10 km south-southwest of Bigadic.

More than 1,200 aftershocks were recorded by August 13, including at least 19 events greater than magnitude 4.0.

Aon's report noted that impacts were felt primarily across the provinces of Balikesir and Manisa, where moderate structural and infrastructural damage was recorded.

Initial reports by local authorities said at least 426 buildings had been severely damaged or collapsed, while 61 were slightly damaged, mostly in rural areas.

According to the U.S. Geological Survey's Prompt Assessment of Global Earthquakes for Response system, economic losses have a 43% probability of reaching into the hundreds of millions of U.S. dollars, pending future loss development.

Insured losses are expected to be "considerably lower", although Aon noted that the industry loss bill may still be substantial owing to the TCIP's relatively high penetration in Balikesir.

According to TCIP figures, the province has a 64% take-up rate, with 241,431 policies in force for around 377,000 buildings.

In comparison, Manisa has a 44.8% take-up rate, with 158,066 current policies across 353,000 total buildings.

The Kahramanmaras earthquake sequence, which struck several regions across south-central Turkey and northwestern Syria in February 2023, was the costliest catastrophe event in Turkey’s history in terms of insured losses, with residential building losses covered by the TCIP. Commercial lines losses and TCIP top-ups were covered by the private market.