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As a country, we have been struggling with devastating wildfires occurring across different regions in recent days. While forests have been severely damaged, many living creatures have also perished in the affected areas.
As the fires reached city centers, not only forests but also numerous homes, vehicles, and businesses suffered damage, resulting in significant financial losses. Those without insurance are now left wondering how they will cover their losses, while insured individuals have already begun the damage assessment process.
The Vital Importance of Fire Insurance
The recent disasters have once again highlighted the importance of fire insurance. Learning from the experiences of policyholders who have previously endured such tragedies is crucial in understanding the value of being insured.
One such case is Cantek Group, which suffered a massive factory fire. Thanks to the 37.5 million TL payout from its insurance company, the company was able to rebuild its factory within just six months.
Despite only six to seven months having passed since the fire, the factory has been completely reconstructed, incorporating planned innovations, according to Hakan Karaca, Chairman of Cantek Group. “We need about two more months to resume normal operations,” he stated.
“When the Insurance Company Arrived, the Smoke Was Still Rising”
Karaca recounted the process following the fire:
“On the second day after the fire, our insurance company’s owner, our broker, and the loss adjuster all arrived at the factory. They conducted an on-site inspection. When they arrived, there were still areas where the smoke was rising. They carried out their assessments. There were certain procedures and permits that needed to be obtained.”
“Since they wanted to clean up the site as soon as possible to produce a more detailed and accurate report, they compared our declarations with their own findings. Our factory was insured for around 40 million TL, and in the end, the company paid out 37.5 million TL. The entire building had burned down, and they handled the process with remarkable professionalism and diligence.”
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NART Insurance Helped Cantek Group Rebuild After a Devastating Fire
Levent NART, Chairman of the Board of NART Insurance & Reinsurance Brokerage Inc., stated that Cantek Group suffered severe fire damage due to an electrical short circuit in their plant factory. Within just two hours, the fire reduced a major facility to ashes.
“As soon as the fire broke out, we swiftly reviewed the insurance policies, contacted our loss adjusters and the insurance company, and stood by our insured client the very next day—while the smoke was still rising. We promptly conducted damage assessments, confirmed the coverage, and made the first advance payments within approximately 10 days,” said Levent NART.
A Rapid Recovery in Just Five Months
After the initial assessment, NART and his team worked closely with Cantek Group’s leadership, including Hakan Karaca and his brothers, to rebuild the facility within five months.
“Thanks to the organizational capabilities of the company, the insurance company’s swift compensation payments, and our effective coordination with loss adjusters and the client, we successfully rebuilt the factory in record time. As a result, this facility, which exports to 60 countries, resumed its operations, once again contributing to our economy,” NART explained.
“If I Had Known, I Would Have Purchased Business Interruption Insurance”
While most of the fire damage was covered by insurance, Hakan Karaca, Chairman of Cantek Group, discovered the significance of Business Interruption Insurance during this period.
“I learned that there is a type of insurance that covers lost profits when a business is unable to operate. If I had known before, I would have definitely purchased Business Interruption Insurance. Now, we have insured all three of our factories under this coverage,” Karaca stated.
“This experience has made us more cautious. Some things are hard to understand until they happen. Major disasters like this are extremely traumatic. We already operate in an incredibly competitive environment, and if we hadn’t been insured, this incident could have set us back 15 years. That’s why we say, ‘We are so glad we were insured.’”
“Industrialists Should Opt for the Broadest Insurance Coverage”
Karaca emphasized that having comprehensive insurance is crucial, particularly for industrialists, and recommended securing policies that include Business Interruption Insurance.
“This is not a game. Fires are disastrous—they destroy everything, completely wiping out years of hard work in an instant. It may not happen often, but when it does, it can erase 20-30 years of accumulated assets in a matter of hours,” he warned.
The Crucial Role of Business Interruption Insurance
Levent NART strongly advocated for Business Interruption Insurance, explaining:
“When a fire, earthquake, or even a terrorist attack halts your business, you can recover the cost of your building, machinery, and equipment through insurance. However, the ongoing fixed expenses and lost profits during downtime become a financial burden on the business owner.”
He provided a practical example to illustrate why companies should invest in Business Interruption Insurance:
“For a company generating $3 million (or TL) in revenue, approximately 30-35% of that could be lost due to business interruption. Without a solid financial structure, this loss could cripple a company. Take Cantek Group, for instance—their employees still had fixed expenses during the shutdown. Dismissing workers wasn’t an option since they would have to be rehired within six to seven months, which would also involve severance payments. Instead, they had to retain and pay their employees, covering salaries, employer contributions, and insurance premiums, which make up 10-15% of operating expenses. Other fixed costs typically account for around 5%, while most companies maintain a 10-20% pre-tax profit margin.”
“When you add these figures up, a business generating $100 million (or TL) in revenue could suffer a $30 million loss due to business interruption. That’s why I strongly recommend every business owner to purchase Business Interruption Insurance.”