New regulation regarding integrated insurance from SEDDK

While determining the procedures and principles regarding integrated insurance offered with products or services during shopping, the Insurance and Private Pension Regulation and Supervision Agency (SEDDK) imposed an upper limit on the annual gross insurance premium and prohibited making insurance a condition of purchasing a product or service.

The Regulation on Integrated Insurances prepared by SEDDK came into force after being published in the Official Gazette.

With the regulation, rules were determined for the reliable, transparent and effective execution of insurance against risks directly related to these during the sale or rental of goods or services.

Accordingly, the annual gross premium amount for the coverage to be offered within the scope of integrated insurance cannot exceed the monthly gross minimum wage amount valid in the first 6 months of the relevant calendar year as of the start date of the coverage. SEDDK Board can reduce this upper limit by half or increase it by up to two times on the basis of goods or services.

The duration of insurance coverage will be a maximum of 2 years. For products with extended warranty coverage, this period can be extended in line with the warranty period.

Purchasing insurance cannot be a condition for purchasing products or services.

With the regulation, the purchase of integrated insurance will not be made a condition for purchasing or renting the relevant goods or services. Not choosing insurance will not be a reason for changing the price of the product or service or other sales conditions to the detriment of the consumer.

Integrated insurance can be offered during the sale or rental of the goods or the sale of the service or within 14 days from the establishment of the sales and rental agreement.

If the insurance is offered physically or electronically, the title and contact information of the company providing the insurance, the information of the insurance intermediary, if any, the premium amount and the scope of the insurance will be disclosed to the consumer. It will also be stated that if the risk occurs, the compensation will be paid by the insurance company that assumes the risk or the pension company that provides insurance coverage.

Consumer can easily terminate their insurance

With the regulation, requests for termination of the contract in integrated insurances are allowed to be submitted via any remote communication tool.

Platforms offering insurance will be obliged to establish systems that will ensure that the cancellation request can be submitted using the method used during the establishment of the contract. When terminating the contract, the policyholder cannot be subject to more severe conditions than the method he used at the beginning.

If the right of withdrawal, termination, cancellation or return is exercised in the goods or service contract subject to integrated insurance, the insurance contract will automatically terminate without the obligation to pay any compensation or penalty.

Types of insurance covered and excluded

Within the scope of integrated insurance, coverage can be provided against risks such as breakage, loss, theft, burning and malfunction of goods. This will also include risks associated with illness, theft and loss of pets.

Insurance can also be offered against risks such as unavailability, cancellation, interruption or unauthorized use of travel, transportation, accommodation, events, subscriptions, bill payment, cyber security and shared or short-term motor vehicle rental services.

In addition, insurances that must be presented in visa and residence permit applications, as well as life, debt payment and personal accident insurances related to individual loans provided by banks through electronic commerce environments that do not belong to them, can also be considered within the scope of integrated insurance.

Compulsory insurance, home and workplace insurance, compulsory earthquake insurance, health and disease insurance, agricultural insurance, savings and investment insurance, transportation and legal protection insurance will not be offered within this scope.

On the other hand, if the insurance premium is collected together with the cost of goods or services, it will need to be shown separately in the payment document. Insurance companies will inform the consumer and obtain his/her approval through a secure method before the contract is established.

Authorized institutions that will implement the regulation within the scope of the regulation will be required to notify SEDDK one month before starting their activities.

The regulation regarding distance-contracted insurance contracts has also been amended.

On the other hand, the "Regulation on Amendments to the Regulation on Activities to be Considered within the Scope of Insurance and Distance Insurance Contracts" prepared by SEDDK was also published in the Official Gazette.

With the amendment, the existing regulation on the limits of insurance activities and distance-contracted insurance contracts has been harmonized with the new regulation on integrated insurance. In this context, while a reference to the Regulation on Integrated Insurances was added to the regulation, article 10 was abolished.