Liga Asuransi – Dear readers, how are you? Hopefully, your business will run well and smoothly. As usual, we will always present exciting news and updates according to the information.
Here we have summarized seven news update options for you. If you are interested in this article, please share it with your colleagues so they understand like you.
OJK’s New Rules, Policy Holders Also Bear If the Joint Business Insurance Loses
KONTAN.CO.ID – JAKARTA. The Financial Services Authority (OJK) issued Regulation (POJK) number 7 of 2023 concerning Governance and Institutionalism of Insurance Companies in the Form of Joint Businesses.
Head of Department and Development of OJK’s IKNB, Djonieri, explained that this regulation stipulates that insurance companies in joint ventures must implement good corporate governance.
Among other things, regulating the membership of the joint venture, the leading party in the joint venture, and strengthening the oversight function in the joint business, namely the compliance function, committees, and public accountants, relations with stakeholders, namely parties who have an interest in an Insurance Company in the form of a Joint Business.
“Including investment arrangements, risk management, and internal control in conducting business activities,” he told Kontan.co.id, Wednesday (31/5).
Djonieri revealed, given the characteristics of Joint Ventures where the policyholders are members of the joint venture, this regulation also stipulates a mechanism for utilizing profits that can be distributed to members, including charging losses to members.
“The rules in POJK 7 will be applied to joint ventures, in addition, POJK 7 is a mandate from the P2SK Law,” he said.
According to him, based on Law 40 of 2014 concerning insurance states that joint ventures only exist now, so there will be no other joint ventures.
“The POJK has been in force since it was promulgated on May 11, 2023. However, he said that most of the provisions, such as the governance of the general meeting of members, and provisions for imposing losses, have been regulated in the PPSK Law, which took effect on January 12, 2023,” he said.
Based on Kontan.co.id monitoring, Indonesia’s only joint venture insurance is the Bumiputera 1912 Joint Life Insurance (AJB).
Djonieri explained conceptually an insurance company in the form of a joint venture (mutual insurance) is a policyholder who is a member who is also the owner of the company.
“So if the company makes a profit or loss, then the policyholder as the owner of the company has the right to receive profits and at the same time be burdened if he suffers a loss,” he explained.
He emphasized that the P2SK Law and POJK 7/2023 further emphasize the obligation to implement profit utilization and/or charge losses that AJB Bumiputera has not carried out. Where, he said, Bumiputera should have done long ago when experiencing losses or profits.
“As the company’s owner, the policyholder will still be affected by losses caused by the company’s management, like other companies. He concluded that the accountability mechanism for joint business management is carried out through the General Meeting of Members (RUA), which functions similarly to the GMS in a Limited Liability Company,” he concluded.
Insurance Premium Grows, and Property Insurance Remains Dominant
KONTAN.CO.ID – JAKARTA. General insurance premium income still recorded growth in the first quarter of 2023. Meanwhile, the property insurance business line dominated all total premium income in that period.
The General Insurance Association of Indonesia (AAUI) noted that the property insurance premium market share in the first three months of this year reached 24.5% of the total premium, where property insurance premiums grew 11.9% annually to IDR 6.4 trillion.
However, Deputy Chairperson of AAUI for Statistics & Research Sector Trinita Situmeang said property insurance had decreased compared to the same % last year, which was 25.5%.
“One of the reasons for this decline is the result of declining sales for properties in the first quarter of 2023,” said Trinita.
Quoting data from Bank Indonesia, Trinita said that the survey results indicated that residential property sales on the primary market in quarter 1/2023 decreased by around 8.26% yoy.
Trinita also said it is still constant if you look at the market share. Every quarter, it is the largest in property insurance, second for motor vehicle insurance, third for credit insurance, and fourth for health insurance.
He also explained that growth was recorded in the first quarter of 2023 for the Motor Vehicle Insurance business line because it was supported by an increase in retail sales for 2-wheelers by 45.5% and 13.8% for 4-wheelers.
Meanwhile, motor vehicle insurance premiums in January-March 2023 rose by around 9.6% yoy to IDR 5.19 trillion. In comparison, motor vehicle insurance premiums in the same period last year amounted to IDR 4.74 trillion.
Meanwhile, the Chairman of AAUI, Budi Herawan, said that the main focus of AAUI is how to make this industry healthy. The three most extensive general insurance business lines, namely property, motor vehicles, and credit, eroded revenue a little because the acquisition costs were high.
“If the credit insurance is already clearly suffering. I think the property is still a surplus, but there are (challenges). Motorized vehicles are the same,” he said.
Source: https://keuangan.kontan.co.id/news/premi-asuransi-tumbuh-asuransi-properti-tetap-mendominasi
Manipulation of Claims is a Specter in the Insurance Industry? AAUI Says This
Bisnis.com, JAKARTA — The Indonesian General Insurance Association (AAUI) views that fraudulent claims have not yet become a scourge in the general insurance and reinsurance industry. Trinita Situmeang, Deputy Chairperson of AAUI for Statistics & Research, said this when meeting after a presentation on AAUI’s performance for the first quarter of 2023 in Jakarta Tuesday (30/5/2023). However, Trinita hopes that claim manipulation will not occur in general insurance and reinsurance companies.
“We don’t see claims manipulation being an issue in general insurance. Hopefully not. This means that risk management must work and be minimized with several steps to manipulate claims,” said Trinita.
Furthermore, Trinita said that until now, her party had not received reports regarding the manipulation of claims at general insurance and reinsurance companies. “I don’t see anything as a major issue. He added that we have not received reports on general insurance and reinsurance,” he added.
Previously, PT Reasuransi Indonesia Utama (Persero) or Indonesia Re said that fraud or manipulated claims were an essential concern in the insurance industry. Indonesian Operations Technical Director Re Delil Khairat said this issue is a scourge in Indonesia and the world.
“All over the world, not only in Indonesia, fraud claims have become an issue that has always been a scourge of claim settlement, which ultimately increases claims for the insurance industry,” said Delil to Bisnis, Monday (29/5/2023).
That is, Delil explained that there was a claim that should not have been paid according to the terms of the policy, but because of the manipulation and fraud of the claim, this made the insurance company still had to pay for the claim.
“The issue of fraudulent claims must be monitored. Many other problems in Indonesia entangle the insurance industry, especially during Covid-19. It seems that the focus on managing fraud is weakening. Therefore, we are raising this issue again to the surface,” he explained.
OJK Will Raise Minimum Capital. Insurance Companies Start Preparing
Jakarta – The Financial Services Authority (OJK) is working on a plan to increase the minimum capital for insurance, reinsurance, Sharia insurance, and Sharia reinsurance companies. Under these conditions, insurance entrepreneurs are preparing to take a swing.
Chairman of the Indonesian General Insurance Association (AAUI) Budi Herawan said that no one objected to the increase plan based on the meeting results he had held with the members. However, his party asked the regulator to consider several things.
“The point is not rejecting it, but in one conclusion, the concern is the time and the value of the increase in how much,” he said in a Press Conference on General Insurance Data for the First Quarter of 2023 at the Permata Kuningan Building, South Jakarta, Tuesday (30/5/2023).
Budi said, currently the insurance industry itself is facing several challenges. In this case, the condition of business actors is not entirely healthy. This has made his party now prioritize the financial health of association members.
“How to return underwriting results to cover operational costs or other expenses. Because from the financial reports for the last 3-5 years, general investment performance profits are supported by investment returns,” he explained.
Besides that, Budi also suggested that the government could first relax regarding the minimum capital increase. The reason is that shortly, the industry is also preparing to implement PSAK-74, which is the adoption of IFRS-17. The implementation also requires a lot of capital.
“AAUI, in its proposal, will later ask for relaxation whether this discourse, if indeed it will be made into one POJK, can be implemented after seeing the implementation of PSAK-74 or IFRS-17. This is an inseparable link,” he said.
In addition, Budi believes that an increase in own capital is not the only indicator that can state whether an insurance company is considered healthy or guarantees significant growth.
“When we heard from insurance, no one rejected what was proposed. However, we will immediately counter what was conveyed by the regulator. First, what was the intention, why did the numbers appear, and also, how come the time for relaxation was running short,” he said. Budi.
RI-South Korea Boost Cooperation in the Insurance Sector in This Way
Jakarta – Hanwha Life, a life insurance company from South Korea, together with Samsung Fire & Marine Insurance and KB General Insurance, held the K-Insurance New Vision Forum.
The K-Insurance New Vision Forum will be held on May 12, 2023, at the St. Regis Jakarta. This event aims to strengthen bilateral cooperation between Korea and Indonesia in the financial sector and be a form of government and corporate synergy commitment in the growth of Indonesia’s insurance industry and financial sector.
Hanwha Life Korea CEO Yeo Seung-Joo said the Korean insurance company declared the values of fair competition, consumer protection, and strengthening financial inclusion.
“From now on, Korean insurance companies will continue to provide effective solutions and reliable services to customers, encourage cooperation with local communities, and build a sustainable insurance industry in Indonesia. Korean insurance companies have become a close part of Indonesian society, not just guests. a moment,” he said.
CEO of Hanwha Life Indonesia, Steven Namkoong, continued the K-Insurance New Vision Forum, which took the theme Together and Further with K-Insurance with the values of fair competition, consumer protection, and financial inclusion. This was held to celebrate 50 years of diplomatic relations between Korea and Indonesia (1973- 2023).
“2023 also marks 10 years of Hanwha Life protecting the people of Indonesia. Hanwha Life is the first Korean life insurance operating in Indonesia and the only Korean insurance company in Indonesia with life insurance and general insurance business lines,” he continued.
PT Hanwha Life Insurance Indonesia has been licensed and supervised by the Financial Services Authority (OJK) since October 24, 2013. It is included in the 15 Best and Strongest Life Insurance Indonesia 2023 list from CNBC Indonesia Ratings. Hanwha Life is a subsidiary of Hanwha Group, the top 10 major Korean conglomerate (chaebol) included in the Fortune Global 500 list (Rank 306 in 2022) and Forbes Global 2000 (Rank 708 in 2022).
Credit Insurance Claims Rise, Companies Will Improve
JAKARTA, KOMPAS.com – The Indonesian General Insurance Association (AAUI) notes that the industry has paid credit insurance claims of IDR 2.94 trillion in the first quarter of 2023.
This value grew to 53.2 percent annually compared to last year’s IDR 1.91 trillion.
Deputy Chairperson of AAUI for Statistics and Research Trinita Situmeang said, despite showing an increasing trend, every insurance company continues to make improvements to reduce the number of credit insurance claims.
“As we see, the condition of the existing claims is in the (public) insurance companies themselves. We see them making improvements,” he said in a presentation on AAUI’s performance for the first quarter of 2023, Tuesday (30/5/2023).
He added the speed at which insurance companies make changes also depends on the policies taken by each company.
Moreover, the insurance industry is facing a deadline for implementing PSAK 74 and discourse on increasing capital. With that, the hope is that the insurance company can immediately improve.
Furthermore, Trinita explained, credit insurance claims account for 71 percent of the total industry claim payments.
This value jumped from last year’s credit insurance claim payment ratio of 59 percent.
“So if the loss ratio of claims paid for health insurance and credit insurance increases, then the largest market share will affect the overall performance or underwriting results in (general) insurance and reinsurance companies,” he said.
For information, AAUI noted that in the first quarter of 2023, the general insurance industry paid a total claim of IDR 9.9 trillion. This figure grew 8.9 percent annually compared to last year’s IDR 9.09 trillion.
Merger with Chubb Life, OJK Revokes Cigna Insurance Business License
JAKARTA, KOMPAS.com – The Financial Services Authority (OJK) revoked the business license of the life insurance company PT Asuransi Cigna. This was because Cigna entered into a merger with the life insurance company PT Chubb Life Insurance Indonesia.
Head of Department of Licensing, Special Inspection and Quality Control of IKNB OJK Asep Iskandar said the decision was stipulated in the Decree of the Board of Commissioners of the Financial Services Authority Number KEP-32/D.05/2023 dated 16 May 2023.
“With this announcement, the OJK has revoked the business license of a life insurance company in connection with the merger of PT Asuransi Cigna into PT Chubb Life Insurance Indonesia,” he said in an official statement, quoted Monday (5/6/2023).
He added the revocation of the business license was effective from 3 February 2023, as stated in the deed of merger Number 07 dated 3 February 2023, drawn up before Mala Mukti, S.H., LL.M., notary in Jakarta.
This business merger has also obtained evidence of registration in the Legal Entity Administration System as stated in the Minister of Law and Human Rights letter AHU-AH.01.09.0061485 dated 3 February 2023.
Meanwhile, since the effective date of the merger of PT Asuransi Cigna into PT Chubb Life Insurance Indonesia, PT Chubb Life Insurance Indonesia, as the party receiving the merger, is responsible for the transfer of all activities.
Asep explained the transfer of these activities also covered business and operational activities. “Share capital, employees, assets, permits, liabilities, and all other assets and liabilities, in the broadest scope of PT Asuransi Cigna as a result of the merger,” he said.
This information is presented by L&G Insurance Broker – The Smart Insurance Broker.
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