Why All Risk Insurance Deserves a Line Item in Every Qatari Investor's Budget
Qatari family offices and developers entering the Turkish construction market often treat insurance as a line item to be finalized after the contract is signed. In practice, the Contractor's All Risk (CAR) policy, and its erection counterpart, EAR, for projects with heavy plant and equipment, should be negotiated alongside the construction contract itself. Coverage gaps discovered mid-project are expensive to fix and sometimes impossible to backfill once a loss has already occurred.
How Türkiye's CAR Market Differs From the Gulf
Türkiye's insurance sector is mature, competitive, and largely reinsured through European and international markets, which gives Qatari investors access to underwriting capacity comparable to what they would find in Doha or London. The practical difference is procedural. Policies are typically issued in Turkish Lira or, for larger projects, in foreign currency by agreement with the insurer, and premium calculation is closely tied to declared contract value, site seismic zone, and construction methodology. Given Türkiye's exposure to earthquake risk, most CAR policies either embed seismic coverage with a distinct deductible structure or require it as a costed endorsement. Investors who assume seismic risk is bundled at no extra cost are often surprised at binding.
Key structural point : unlike some Gulf jurisdictions where a single umbrella policy might cover a portfolio of assets under one sponsor, Turkish practice generally ties CAR coverage to a specific project and contract value, renewed or adjusted as the works progress and the sum insured changes.
What the Policy Should Actually Cover
A properly structured CAR policy for a Qatari-backed development in Türkiye should address four areas explicitly rather than by assumption.
Material damage : physical loss or damage to the works, materials, and temporary structures on site, including during transport to site and storage before installation.
Third-party liability : injury or property damage to parties outside the contract, which matters in dense urban sites common in Istanbul, Izmir, and coastal resort developments where adjacent buildings and public infrastructure are exposed to construction activity.
Existing structures clause : essential for renovation or extension projects, since standard CAR wording often excludes damage to the existing building unless this clause is specifically added.
Maintenance period cover : extending protection through the defects liability period after practical completion, when contractor mobilization has reduced but the developer's exposure has not.
Aligning Insurance With the Construction Contract
The insurance clause and the construction contract need to speak the same language. If the contract is FIDIC-based, as most internationally financed Turkish projects are, the CAR policy should mirror the contractor's and employer's respective insuring obligations under the relevant clauses rather than leaving gaps between what the contract requires and what the policy actually delivers. Qatari investors should request the insurance certificate and full policy wording before works commence, not a broker's summary, and should confirm the employer or its financing party is named as a joint insured or loss payee where the financing structure requires it.
Practical checkpoint : reconcile the sum insured against the full contract value plus professional fees and demolition or debris removal costs, since underinsurance clauses in Turkish policies can proportionally reduce a claim payout if the declared value falls short of actual reinstatement cost.
Deductibles and Claims Handling
Deductibles for earthquake and flood perils are typically set as a percentage of the loss rather than a fixed sum, which can materially change the economics of a claim on a large project. Qatari sponsors should model a plausible loss scenario against the deductible structure before binding cover, rather than after a claim arises. Working with a broker who has direct experience placing CAR policies for foreign-sponsored projects in Türkiye, and who can coordinate claims handling in English alongside the Turkish-language process, reduces friction considerably if a loss does occur.
A Practical Starting Point
For Qatari investors structuring a new development or renovation in Türkiye, the insurance conversation belongs in the same meeting as the contractor selection and financing structure, not as an afterthought once the contract is executed. Eurasia Experts works with clients to align policy wording, contract clauses, and sum insured calculations before ground is broken, so coverage matches the actual risk profile of the project rather than a generic template.