Liga Asuransi – The development of the insurance industry is always interesting to follow, and this time we have summarized 7 news related to insurance that you should know.
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4 Year Merger, MAGI Officially Changes Name to AXA Insurance
General insurance company PT Mandiri AXA General Insurance (MAGI) officially changed its name to PT AXA Insurance Indonesia (AXA Insurance) in semester II/2023.
President Director of AXA Insurance, Laurent Bourson, explained that this change had been approved by the Ministry of Law and Human Rights on 27 June 2023 and had been reported to the Financial Services Authority (OJK).
“AXA is a leading insurance brand in the world. The new company name is one of the first steps to expand our services and reach the open market,” said Laurent in an official statement on Wednesday (5/7/2023).
As a company that provides risk coverage and reimbursement due to losses, costs incurred, lost profits, or legal liability to third parties, this name change also emphasizes AXA Insurance’s commitment to continue improving.
This is based on the success of previous customer journey digitization efforts. Some of them are the launch of a virtual assistant for customers named Emma, an e-commerce platform for lifestyle insurance called AXA myPage, and ease of doing business for customers and business partners.
AXA Insurance is also trying to expand its services and reach more people and businesses in Indonesia through various marketing channels, including agency, partnership, broker, digital, and bancassurance. Bank Mandiri remains the company’s leading bancassurance partner.
“Going forward, we will introduce a series of product and service innovations, especially through digitization, to make life safer, fairer, and more inclusive,” he added.
AXA Insurance guarantees that all insurance policies and contracts previously issued by MAGI will remain valid until the end of the coverage period by the terms and conditions stated in the document, and PT AXA Insurance Indonesia will be fully responsible.
“All customers, business partners, employees, and shareholders are our top priority. I am confident that with the new company name, AXA Insurance, the company’s profitable and sustainable growth will be accelerated,” Laurent concluded.
Previously, MAGI was a joint venture between AXA and PT Bank Mandiri (Persero) Tbk. (BMRI) since 2011. Then, MAGI merged with another general insurance company owned by AXA, PT Asuransi AXA Indonesia (AXA General Insurance – AGI), at the end of 2019.
Insurance Industry Waits for New Rules Regarding Credit Insurance
Credit insurance claims are currently the focus of attention of the Financial Services Authority (OJK) and the insurance industry due to the increase in claims during the Covid-19 pandemic.
President Director of PT Asuransi Asei Indonesia, Achmad Sudiyar Dalimunthe, stated that debtors who cannot pay installments to banks due to the impact of Covid-19 could cause bad credit. In this case, credit insurance issued by the insurance company must bear the risk.
Dody, Achmad Sudiyar Dalimunthe’s nickname, explained that the Covid-19 pandemic indicated that the current credit insurance regulations still needed to be updated. This includes risk management and the application of a balanced premium.
According to Dody, the high number of claims during Covid-19 shows that the premiums collected still need to be balanced. This means that the premium received still needs to be increased.
In addition, Dody also highlighted the credit insurance term, which has a long term. If the period is extended, adequate reserve funds should be prepared, but many insurance companies still need to do so according to regulations. This is undoubtedly a problem for insurance companies.
“Therefore, insurance companies need to mitigate risk by communicating with the insured bank to renegotiate terms and conditions so that not all bad credit risks are guaranteed by insurance. This means there must be limits,” he said.
According to him, risk sharing is being pursued in the latest regulations regarding credit insurance. The banking sector will likely bear 30 percent of the risk, while insurance will cover 70 percent. Thus, not all bad credit risks will be covered by insurance.
In addition, Dody stated there was a need for regulation regarding the rates applied. This is due to the increasing number of credit insurance players; several companies still need to gain sufficient competence.
Dody hopes that the rules regarding credit insurance can be improved. Even though it takes time, on the other hand, it is still being determined if banks will agree regarding risk sharing and other matters.
“However, this is a process, and OJK facilitates it. We have to look to the future, this is a significant business, and hopefully, it can help banks properly because if there is no insurance, they will bear high risks,” he added.
On the other hand, the Main Director of PT Reasuransi Indonesia Utama or Indonesia Re, Benny Waworuntu, also welcomed OJK’s efforts in finalizing new regulations regarding credit insurance.
“While they are waiting, we do the right and good risk selection, which means we don’t refuse at all, but we make sure the risks we bear are by the risk mitigation we are doing,” said Benny.
Benny considers that the surge in credit insurance claims is quite complex, but the most important thing is risk selection. This risk selection not only exists in insurance and reinsurance but must also be carried out in banking or financial institutions and by consumers.
“He must be aware of the risks that exist, whatever the risks are. So, awareness of these risks is a challenge for all parties, coupled with business process issues such as terms and conditions that are covered and not covered, as well as pricing, preparation of reserves, and management,” he explained.
According to data from the Indonesian General Insurance Association (AAUI), credit insurance claims increased 53.1 percent year on year (yoy) to IDR 2.94 trillion in the first quarter of 2023. This figure contributed 29.6 percent to the total claims paid in that period.
The scarcity of actuaries is still an obstacle to general insurance
KONTAN.CO.ID – JAKARTA. The Financial Services Authority (OJK) notes that many insurance companies still do not have actuaries, and OJK encourages the industry to fulfill this immediately.
OJK’s Chief Executive for Insurance, Underwriting, and Pension Fund Supervision, Ogi Prastomiyono, said that Law Number 40 of 2014 concerning Insurance confirms that every insurance company must have an actuary.
“We will enforce the law in early 2023 so that insurance companies that do not yet have actuaries must fulfill these requirements,” he said in a press conference at the OJK Board of Commissioners Meeting (RDK) on Tuesday (4/7).
Ogi said that previously 50 insurance companies did not have actuaries. Currently, 20 actuaries have joined insurance companies, so there are still 30 companies that still need actuaries.
“We are waiting for the latest developments at the end of last June,” he said.
Ogi does not deny that insurance companies are concerned about several issues regarding actuaries related to certification. He explained that actuary certification in the insurance industry includes fellows and associates.
“We don’t mind our certification as long as the Indonesian Association of Actuaries (PAI) recommends us to conduct conformity tests for prospective actuaries,” he explained.
He stated that the OJK gave insurance companies a deadline to fulfill these requirements after failing to meet the deadline at the end of June 2023.
“We have given until the end of 2023 to fulfill these requirements immediately,” he said.
Furthermore, Ogi added that the OJK did not hesitate to impose sanctions on insurance companies that violated it, including the first and second warning letters.
“We do not hesitate to impose restrictions on business activities for insurance companies that do not have an actuary,” he said.
Meanwhile, the Indonesian General Insurance Association (AAUI) Chairman, Budi Herawan, explained that insurance companies do not yet have actuaries because of high costs.
“There is only one problem, namely costs. The cost for an actuary is not small, so this is burdensome,” he said when we met in Jakarta on Wednesday (6/7).
Budi stated that insurance companies must fulfill the consequence that when an actuary proposes matters relating to business activities, this must be followed and, of course, requires quite a hefty fee.
Apart from that, according to him, there are also remuneration costs which are incentives company employees receive based on their achievements.
“But I remain optimistic that everything will be fulfilled by the end of December because there are around 430 actuaries on the market, while we only have a shortage of 30 actuaries already in the process. All that remains is to submit a conformity test to the regulator,” he explained.
Meanwhile, the Main Director of PT Asuransi Asei Indonesia, Achmad Sudiyar Dalimunthe, said that the general insurance industry lacks actuaries due to their limited number.
“Because only a few people have become FSAI (Fellow of the Society of Actuaries of Indonesia) and become PAI, so only a few have entered general insurance,” he said.
Dody, Achmad Sudiyar Dalimunthe’s nickname, said that due to the limited number of actuaries, many general insurance companies competed with each other to recruit actuaries so they could join the company.
“This is a condition that is happening right now, and it’s unhealthy,” he explained.
Dody stated that because regulations require companies to have actuaries, the general insurance industry has no choice but to employ a limited number of actuaries, resulting in higher costs.
“But it’s not a question of cost. The problem now is the imbalance between supply and demand,” he added.
For this reason, Dody suggested that one actuary could temporarily manage three general insurance companies. However, when PAI has graduated more actuaries, actuaries will no longer handle three companies simultaneously.
Source : https://keuangan.kontan.co.id/news/kelangkaan-aktuaris-masih-jadi-kendala-asuransi-umum
What is Earthquake Insurance, and How to Claim It?
KONTAN.CO.ID – The earthquake with a magnitude of 6.4 that recently occurred in Bantul, Yogyakarta, adds to Indonesia’s long list of earthquake natural disasters. As an area prone to earthquakes, you need to have earthquake insurance.
Earthquake insurance can be used as a preventative measure to minimize financial losses resulting from the disaster. Apart from self-harm and property damage, earthquakes can also damage other property, such as vehicles inside the house.
Therefore, vehicle owners need to reduce repair costs due to earthquake disasters by having insurance. Benny Fajarai, Co-Founder and CMO of Lifepal.co.id explains what earthquake insurance is and how claims are made.
Earthquake insurance is an insurance product that pays policyholders if they experience financial losses due to an earthquake. However, insurance coverage covers earthquake disasters and other events such as tsunamis, volcanic eruptions, and fires.
This insurance will compensate you for items damaged by the earthquake, including property and other assets such as motorized vehicles.
Earthquake insurance also provides benefits and protection in the event of a volcanic eruption or fire caused by an earthquake. However, if a tsunami accompanies the damage caused by the earthquake, the insurance will provide coverage for all damages that occur according to the agreement in the policy.
While earthquake insurance can cover buildings, furniture, household appliances, machinery, merchandise, supplies, and more, there are some risks that this insurance does not cover. Some risks that are not guaranteed include riots, strikes, malicious acts, civil commotion, terrorism, natural disasters such as floods, vehicle collisions, and theft.
To broaden the scope of insurance protection and how to claim earthquake insurance, car insurance protects vehicles against various risks of damage, including earthquakes. Two types of car insurance are commonly chosen: All Risk and Total Loss Only (TLO).
All Risk or comprehensive car insurance protects against various losses or damages to vehicles due to various risks guaranteed in the policy. Meanwhile, TLO insurance only covers total losses guaranteed in the policy until the loss of the vehicle.
However, natural disasters such as earthquakes are usually not covered in car insurance unless the policyholder has extended coverage or SRCC (Sabotage, Riot, Civil Commotion) in the insurance policy. Several coverage extensions in vehicle insurance cover the risk of floods, earthquakes, landslides, and volcanic eruptions.
To get this benefit, you need to add extended coverage. If not, the insurance company will not cover the damage to the vehicle, and you cannot file a claim.
With this coverage expansion, insurance companies can protect against unwanted natural disasters such as earthquakes, tsunamis, volcanic eruptions, floods, hurricanes, storms, and landslides.
This is an explanation of earthquake insurance and how to claim it. Having earthquake insurance can provide significant financial protection against the risk of an earthquake that may occur.
Source : https://keuangan.kontan.co.id/news/apa-itu-asuransi-gempa-bumi-dan-bagaimana-cara-klaimnya
Go Live, PLN Customer Protection through Public Liability Insurance
PT Asuransi Perisai Listrik Nasional (PLN Insurance) held a Go Live PLN Customer Protection Program through Public Liability Insurance at the PT PLN (Persero) Central Building Auditorium Monday (26/6/2023).
The PLN Customer Protection Program through Public Liability Insurance is a strategic collaboration between PLN Insurance and PT Bank KB Bukopin Tbk, Bank Mandiri Taspen, PT Bank OCBC NISP Tbk, and PT Bank Pembangunan Daerah Banten Tbk.
Through “Public Liability Insurance,” PLN Insurance protects the form of compensation for risks to customers caused by electrical short circuits, such as the risk of fire, the risk of injury due to electric shock, and the risk of death.
With a premium of IDR 500 for each electricity purchase transaction, customers who make an electricity bill payment mechanism through bank partners who have collaborated with PLN Insurance automatically get protection in the form of compensation for death of IDR 15 million, property fire compensation of IDR 12.5 million, and reimbursement of medical expenses of a maximum of 10 percent of compensation for death.
Main Director of PT PLN (Persero) Darmawan Prasodjo conveyed that Innovation from the PT PLN (Persero) Pension Fund and PLN Insurance and collaboration with strategic partners in the Customer Protection Program through Public Liability Insurance is an expansion of services, in providing a sense of security for customers.
YLKI Chairperson Tulus Abadi welcomed the PLN Customer Protection Program by compensating for an electrical short circuit, such as fire risk or injury due to electric shock risk of death.
According to him, PT PLN (Persero) is very innovative in increasing service improvements for the community as customers.
“I appeal to Bank Himbara and Government Banks to participate in the PLN Customer Program through Public Liability Insurance which was initiated by PT PLN (Persero) through PLN Insurance,” said Tulus in a press release Tuesday (27/6/2023).
PLN Insurance President Director Moch Hirmas Fuady added PLN Insurance had prepared a call center to facilitate the claim process for PLN customers who experience property fires, are injured, and even die due to short circuits with a straightforward claim process.
OJK Assesses Classification of Insurance Companies, There Are Differences in Class 1 and 2 Capital
KONTAN.CO.ID – JAKARTA. The Financial Services Authority (OJK) is currently reviewing arrangements related to the classification of insurance companies to increase company capital as well as consolidation. This is done to strengthen the financial structure of insurance companies and maintain their competitiveness in facing global competition.
Chief Executive for the Supervision of the Non-Bank Financial Industry (IKNB) Ogi Prastomiyono explained that this review aims to increase the operational effectiveness and efficiency of insurance companies and protect the interests of policyholders. It is also a preparation for dealing with losses by having a capital buffer (conservation buffer) not to harm policyholders. OJK has held discussions with insurance associations and actors to obtain input in this review.
According to Ogi, the rules that will be applied will have differences between insurance companies with class 1 capital and class 2. Insurance companies with class 1 capital can sell more complex products, while companies with class 2 capital can only sell more specific products.
In addition to reviewing insurance companies’ classification, OJK has finalized the Draft OJK Regulation (POJK) regarding the spin-off of insurance companies for consolidation purposes. OJK is currently conducting consultations with the DPR regarding this matter. Under the POJK that will be issued, insurance companies wishing to spin off must have a minimum capital of IDR 100 billion. This also applies to Sharia business units (UUS) that will carry out spin-offs.
Through UUS Allianz Syariah, PT Asuransi Allianz Life Indonesia is optimizing the company’s performance to achieve the spin-off plan. PT Asuransi Allianz Life Indonesia’s Sharia Managing Director, Achmad Kusna Permana, said that the company continues to develop its sharia business with digital innovation and optimization for products and services, as well as finalizing spin-off plans. The main objective is to meet insurance protection needs that are inclusive and under customer needs in the context of separating sharia units.
OJK Revokes Sun Maju Insurance Broker Business License
The Financial Services Authority (OJK) announced that the business license of PT Sun Maju Broker Asuransi had been revoked on June 23, 2023. The announcement was stated in the Decision of the OJK Board of Commissioners Number 45.D.05/2023, stipulated on July 5, 2023.
PT Sun Maju Insurance Broker, located on Jl. M.H. Thamrin Kav. 8-9, Kebon Melati, Tanah Abang, Central Jakarta 10230, is prohibited from conducting business activities in the insurance brokerage sector. In addition, the company is also prohibited from using the words “Insurance Broker,” “Insurance Broker,” and/or words that characterize the activities of insurance brokers.
“In this decision, companies are required to remove nameplates, both at the head office and branch offices, and the company must also complete rights and obligations following applicable laws and regulations,” wrote the Head of the IKNB Licensing, Special Inspection, and Quality Control Department. , Asep Iskandar.
Based on Kontan’s records, PT Sun Maju Broker Asuransi had previously received a Business Activity Restriction (PKU) sanction from the OJK on December 19, 2022. This sanction was imposed because the company needed to comply with the recommendations from the results of a direct inspection. Finally, this insurance brokerage company’s hopes were dashed by revoking its business license.
Source : https://keuangan.kontan.co.id/news/ojk-cabut-izin-usaha-sun-maju-pialang-asuransi
This information is presented by L&G Insurance Broker – The Smart Insurance Broker.
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