The Insurance and Private Pension Regulation and Supervision Agency's new regulation on determining totally wrecked and severely damaged vehicles has entered into force, starting an era in which grievances about damaged vehicles and unregistered practices in the sector will be reduced.
The regulation, issued in April but with implementation beginning on 1 July 2025, aims to curb abuses in the motor insurance branch.
Total loss
Under the new regulation, if the repair costs of a damaged vehicle exceed the vehicle's market value and an expert report states that the vehicle is beyond repair, it will be considered a total loss.
If the scrap registration document for a total-loss vehicle, showing that the vehicle has been scrapped, is not presented to the insurer, no compensation will be paid.
Heavily damaged
For vehicles that are heavily damaged, if the repair cost exceeds 60% of a vehicle’s market value, it is considered heavily damaged. However, the circular states that if at least one particular, or some parts, are damaged, the expert can determine whether the vehicle is heavily damaged, even if the damage is under 60%.
For a severely damaged vehicle, if the registration document with the stamp "Withdrawn from traffic", showing that the vehicle has been withdrawn from traffic, is not presented to the insurer, no compensation will be paid.
The determination of total or serious damage is to be made by insurance experts. The insured and the insurance company will not be able to make changes to the expert report.