5 Selected Insurance News October – Week 5

Liga Asuransi – Dear readers, I can’t believe we are already at the end of October, and there has been a lot of news about insurance in Indonesia. Here we have summarized five news options. If you are interested in this article, please share it with friends so that they understand.

1. OJK: The Potential for Insurance Growth in Indonesia is Widely Opened

Liputan6.com, Jakarta The Chief Executive of the Financial Services Authority (OJK) IKNB Supervisor, Ogi Prastomiyono, said that the overall penetration of the insurance industry in Indonesia is still shallow compared to other countries.

Ogi explained that Indonesia’s insurance penetration position in 20221 is only 1.6 percent. Compared with India at 4.2 percent, Malaysia at 5.3 percent, and Thailand at 5.4 percent.

“This means there is quite a big opportunity for insurance companies to grow, because we have a large GDP and a large population. So the potential for insurance growth in Indonesia is still wide open,” said Ogi, Jakarta, Monday (24/10).

Insurance products are still low even compared to the general financial services industry or banking. Therefore, he continued, many things that need to be improved related to insurance companies.

“We also need to make improvements where the infrastructure of insurance companies, both in terms of investment management, rest management, and governance, needs to be improved thoroughly. Likewise, later on in supporting institutions and in terms of the OJK as the supervisor of insurance, we will also be more effective supervision,” he explained.

On the other hand, the COVID-19 epidemic certainly had a very significant impact on the financial services industry, including the insurance industry, where the insurance industry is affected in terms of premium receipts, in terms of investments, and also from funds collected by insurance companies.

He revealed that from 2022 to August 2022, the insurance industry grew 7.83 percent in terms of assets to reach Rp. 883.26 trillion, or an increase of Rp. 64.62 trillion compared to the same position in 2021.

“If you look at the Prime Ministerial Regulation’s accumulated income from January to August 2022, 205.9 trillion, this is an increase of 4.24 trillion or 2.10 percent compared to a different year in 2021,” Ogi explained.

Then related to the aggregate capital of life insurance companies, the arbitration reached 485.51 percent. This means it is still above the triol derivative of 120 percent per OJK provisions.

Source : https://www.liputan6.com/bisnis/read/5105990/ojk-potensi-perkembang-asuransi-di-indonesia-terbuka-wide

2. Salim Insurance Loss (AHAP) Swells to IDR 4.69 Billion

Bisnis.com, JAKARTA – Performance of insurance issuers in the Salim Group conglomerate, PT Asuransi Harta Aman Pratama Tbk. (AHAP) experienced a decline in the third quarter of 2022 compared to last year. AHAP recorded a loss of Rp4.69 billion on September 30, 2022.

The condition of AHAP’s performance is inversely proportional to the third quarter of 2021. At this time, the company could record a net profit for the current year of Rp.2.39 billion.

Based on the AHAP financial report published in the disclosure of information Thursday (27/10/2022), the increase in the number of claims is one of the reasons why Asuransi Harta Aman Pratama posted a current net loss in the third quarter of 2022.

In detail, the number of claims for AHAP increased by 54.6 percent year-on-year (YoY) to Rp107.26 billion from the previous Rp69.36 billion. Meanwhile, gross premium grew 27.6% YoY to Rp 534.43 billion, and total net premium income also increased 31.6% YoY to Rp 168.51 billion on September 30, 2022.

Then, investment returns grew by 13.7 percent YoY, from Rp4.96 billion to Rp5.64 billion. Meanwhile, underwriting results fell slightly, namely 1.1 percent yoy to Rp77.62 billion.

The issuer, codenamed AHAP, can have assets worth Rp 754.7 billion. The asset condition rose 22.1 percent yoy from the previous value of Rp 617.97 billion in the third quarter of 2021.

Suppose you look at the financial health indicators of Asuransi Harta Aman Pratama. In that case, the liquidity, investment adequacy, and solvency ratios are above the minimum ratio set. As of September 30, 2022, the three ratios owned by AHAP are 151 percent, 136 percent, and 322 percent, respectively.

Currently, AHAP’s shareholders consist of Asuransi Central Asia, belonging to the Salim Group (62.57 percent), Sendra Gunawan (11.82 percent), and the public (25.59 percent).

Source:  https://finansial.bisnis.com/read/20221028/215/1592420/rugi-asuransi-salim-ahap-membengkak-jadi-rp469-miliar.

3. Legitimate! Bosowa Asuransi Becomes a Partner of Titanium Insurtech Fuse

Jakarta, CNBC Indonesia – Insurance startups Fuse and Bosowa Asuransi work together to develop more complete services and products for their customers. Bosowa Asuransi is part of the Bosowa Corporation conglomerate, which has been active since 1973.

“We are very confident that this strategic partnership can be a strong partnership and provide many benefits for end consumers, considering that Bosowa Asuransi is one of the pioneers of general insurance companies in Indonesia,” said Bosowa Asuransi. Fuse Vice President Hendra Lukman in his official statement, Thursday (27/10/2022).

He explained that Bosowa Asuransi is a client of Titanium Fuse and will jointly develop new insurance products through data analysis to achieve a greater common goal. Meanwhile, Fuse offers technological innovations to help Bosowa Asuransi improve business performance and provide better services to customers.

“We offer added value through big data technology to help Bosowa Asuransi manage risk. With a strong, secure, and scalable technology platform, Fuse helps increase attractiveness and reduce the overall claims ratio,” said Hendra.

Meanwhile, President Director of Bosowa Asuransi Janson Silaen said this collaboration is in line with Bosowa Asuransi’s commitment to providing services and protection, as well as to innovate products sustainably through the use of technology. He believes that Fuse’s distribution channels can reach a broader range of consumers, especially in cities that do not have Bosowa Asuransi branch offices.

“Fuse is a pioneer in insurtech in Indonesia and is now the largest insurtech in Southeast Asia after last year collecting a gross written premium (GWP) of more than Rp. 1.5 trillion. Its mobile technology is easily accessible, has exclusive features, and has more than 70 thousand workers. Marketers/partners. These factors give Bosowa Asuransi extra confidence. In addition to saving our technology investment costs, we hope to achieve quite a large business volume, especially for selling vehicle and property insurance products, “concluded Janson.

For information, more than 40 insurance companies are collaborating with Fuse and eight insurance companies that are Titanium Fuse’s insurance partners, namely Simas Insurtech, Mega Insurance, Tugu Insurance, Staco Mandiri, Artarindo, Etiqa, Intra Asia and Bosowa Asuransi. Fuse labeled these eight insurance companies as insurance partners for the Titanium category.

Source: https://www.cnbcindonesia.com/mymoney/20221027145341-72-383004/sah-bosowa-asuransi-jadi-partner-titanium-insurtech-fuse

4. This is the World’s First NFT Insurance, and Pay Can Use Crypto

Jakarta, CNBC Indonesia – YAS Group (BVI) Ltd (YAS), an insurance company using blockchain technology from Hong Kong, teamed up with Avata, an insurtech company, to launch the first NFT insurance globally.

This insurance service is purchased and issued at the checkout stage of NFT purchases to cover specific cyber hacks and risks associated with the potential exploitation of digital asset contracts.

They also cooperated with many actors, including NIBIRU, Pluck, Bapes, Wert, and iKonic, whose combined NFT transaction value exceeded US$ 500 million. Insurance for NFT usually ranges from 0.05 – 0.1 ETH.

YAS and Avata intend to focus on making NFT insurance services essential for every transaction. Their targets are game publishers, individual artists, museums, and audited NFT projects.

NFT insurance itself usually guarantees the transfer of valuable assets to cover the risk of assets being intercepted during the process by hackers, a common type of digital crime experienced by game publishers and gamers.

Joachim Rittfeldt Hofvenschiöld, Co-founder and CCO Avata, added, “We are very excited to bring the first global NFT insurance service to the market.

“The appeal is huge because there is a real need for NFT owners to insure their digital properties in the market. In the same way, they insure their physical goods,” as quoted from a press release by CNBC Indonesia on Wednesday (10/26/2022).

YAS co-founder Andy Ann stated, “After experiencing the NFT hype last year and skyrocketing cryptocurrency prices, we thought it was time for the market to calm down and rethink the actual value of NFT in the economy.

Source: https://www.cnbcindonesia.com/market/20221026113523-17-382590/ini-asuransi-nft-pertama-di-dunia-bayarnya-bisa-pakai-kripto

5. OJK Prepares New Rules for Selling Insurance Through Banks, Here

Inside bank alias bancassurance.

Based on the official OJK website regarding the draft regulation, this new game rule will be the first amendment to OJK Circular Letter (SEOJK) No. 32/2016 concerning bancassurance.

Chairman of the Financial Industry Supervisory Board OJK’s Non-Bank Account (IKNB) Ogi Prastomiyono revealed that the changes to the old regulations are one of the strengthening of OJK’s internal supervision, as for the three layers of defense, aka the three lines of security in the insurance sector.

For your information, the strengthening of regulations that have been realized is the issuance of SEOJK No. 05/2022 regarding investment-linked insurance products (PAYDI or unit-linked) in March 2022.

“In the future, we will also issue new regulations which essentially are strengthening the insurance industry,” he said in an interview session with one of the national television media some time ago.

As for the RSEOJK regarding bancassurance, there are no fundamental changes related to general provisions and general requirements. However, some additional points are related to the needs and criteria that must be met in each bancassurance business model.

One of them, OJK, added that in the reference business model bancassurance cooperation in the context of bank products, companies are not allowed to provide acquisition costs in the form of commissions or intermediary fees.

For information, in the reference business model, the bank only plays a role in recommending an insurance product to policyholders. Meanwhile, the reference business model is divided into two: references in the context of bank products, aka insurance, as a requirement to obtain a banking product, and references not in bank products, aka insurance, are not a requirement to get a banking product.

Meanwhile, there are also two other business models: the distribution model or the bank explaining insurance products to prospective policyholders and the integration model of insurance products in banking products or bundled products.

Furthermore, another new regulation in this regulation also touches on the context of telemarketing for bancassurance marketing. OJK emphasizes that telemarketing to customers should only be used as a medium for introducing related insurance products.

Furthermore, if the business model is distribution cooperation or product integration, in that case, the insurance company must ensure that the bank that will become the partner has a sufficient number of employees and adequate capabilities.

The capabilities of these marketers must also be accompanied by agency certification documents issued by the relevant associations, as well as evidence that the relevant marketers have attended training regarding the insurance products to be marketed.

In addition, specifically for the business model of distribution cooperation and product integration, OJK also adds an obligation for insurance companies to ensure that banks are responsible for all marketers or employees who offer related insurance products.

First, every marketer and bank employee in charge of marketing insurance products must have provided a correct, precise, complete explanation in simple language and not misleading.

Second, the insurance company must also reconfirm any product closures made by the bank, especially for PAYDI or unit-linked products with cash value benefits.

Finally, OJK added a rule point regarding using digitalization to offer bancassurance, where insurance companies must ensure that banking partners have passed three requirements:

1. Have policies, systems, procedures, and authority in offering bancassurance products through digital.
2. Have the readiness of digital technology infrastructure to support the product.
3. Have the readiness to implement risk management related to security, confidentiality, integrity, authenticity, and availability.

Source:  https://finansial.bisnis.com/read/20221026/215/1591755/ojk-prepare-aturan-baru-penjualan-asuransi-via-bank-ini-isinya.

This information is presented by L&G Insurance Broker – The Smart Insurance Broker 

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