Liga Asuransi – The insurance industry is back in the spotlight with various recent developments, ranging from viral issues regarding the BPJS Health policy to the big challenges faced by the insurance sector due to the largest forest fire in Los Angeles. This article summarizes seven of the most updated and complete insurance news, providing a comprehensive picture of the latest dynamics affecting this industry, both at home and abroad. By understanding these developments, business people, society and stakeholders can prepare the best strategies to face existing challenges and opportunities.
The Biggest Forest Fire in Los Angeles: Threat of Losses of Hundreds of Trillions of Rupiah for Insurance Companies
Los Angeles is again faced with massive forest fires, this time registering as the largest and most destructive in the region’s history. Areas such as Pacific Palisades, Eaton, Hurst and a number of other areas have been consumed by fire, triggering potential insurance claims estimated at more than US$8 billion, equivalent to IDR 130 trillion. This figure was reported by Morningstar DBRS analysts on Friday (10/1/2025), surpassing the record losses due to the Woolsey fire in California in 2018, which previously reached more than US$6 billion.
According to Jasper Cooper, a senior official at Moody’s Ratings, the high value of property and businesses in the affected areas has caused estimated insurance losses to shoot up to billions of dollars. However, this situation also highlights the significant challenges homeowners face in obtaining insurance coverage in disaster-prone areas.
Depressed Insurance Market in Disaster Prone Areas
Denise Rappmund, senior analyst at Moody’s, emphasized that the fire’s impact will bring major changes to the state’s insurance market. The ever-increasing cost of restoration not only results in increased insurance premiums but also reduces the accessibility of property insurance for many homeowners. A number of large insurance companies have even withdrawn from the market, leaving huge gaps in protection for people in disaster-prone areas.
One solution currently available is the California FAIR program, a scheme designed to help property owners in high-risk areas obtain protection. However, these programs only cover a small percentage of losses and cannot replace the protection provided by traditional insurance.
Insurance Claim Escalation
In its latest report, JPMorgan estimates that total insurance losses due to this fire could reach up to US $ 20 billion, double the initial estimate. The spike is due to an increase in the scale of damage that is wider than previously thought, according to a report from the publication The Insurer. With the burden of losses continuing to increase, the insurance sector is facing heavy pressure to strike a balance between providing adequate protection and maintaining the sustainability of their business.
With the threat of forest fires becoming more frequent, it is important for stakeholders to find solutions that can ensure access to insurance protection remains affordable, while minimizing financial risks for all parties involved.
General Insurance Premium Growth Projections 2025: Optimism and Challenges
The general insurance industry in Indonesia is predicted to be able to record significant premium growth in 2025. The Indonesian General Insurance Association (AAUI) expressed optimism that premium income could increase with double-digit growth, thanks to certain sectors that show great potential.
Wahyudin Rahman, an insurance observer and General Chair of the Indonesian Insurance Writers Community (KUPASI), mentioned several sectors that could encourage this growth. “Insurance for the agricultural sector to support food security, disaster insurance, and mandatory Third Party Liability (TPL) insurance for vehicles are examples of areas that have great opportunities,” he said in an interview with Kontan on Wednesday (8/1).
Innovation and Strategy for Growth
Even though the growth prospects are quite bright, Wahyudin emphasized that the general insurance industry needs to adopt an aggressive strategy. Steps such as product innovation, market diversification and increasing insurance inclusion are key to achieving this target.
However, he also reminded that this optimism cannot be separated from the various challenges that must be faced. There are four main challenges expected to affect the general insurance industry in 2025:
- Economic Uncertainty: Fluctuations in inflation and the rupiah exchange rate can have an impact on people’s purchasing power.
- Regulatory Changes: Implementation of new regulations, such as Statement of Financial Accounting Standards (PSAK) 117, separation of sharia units, and capital requirements, is a significant challenge for industry players.
- Increase in Health Insurance Claims: Increased claims in the health sector and intense competition also need to be anticipated.
- Low Inclusion and Penetration: The low level of insurance inclusion in society and limited domestic reinsurance capacity are also obstacles.
General Insurance Performance Until Quarter III-2024
Based on data from AAUI, general insurance premium income until the third quarter of 2024 has reached IDR 79.69 trillion, an increase of 14.5% compared to the same period last year of IDR 69.61 trillion. This figure shows a positive trend which can become initial capital to achieve growth targets in the coming year.
With the various opportunities and challenges that exist, the general insurance industry is expected to continue to innovate and adapt in order to achieve sustainable growth amidst ever-changing economic dynamics.
Separation of Insurance Company Sharia Units: Latest OJK Report
The Financial Services Authority (OJK) reported that as of December 24 2024, as many as 41 insurance and reinsurance companies had submitted Sharia Unit Separation Work Plans (RKPUS). This reflects the industry’s concrete steps in complying with regulations regarding the separation of sharia units.
In the same period, two insurance companies have obtained permission to separate their Sharia Business Units (UUS) into independent sharia insurance companies. Deputy Chairman of the OJK Board of Commissioners, Mirza Adityaswara, in a press conference on the Results of the OJK Monthly Board of Commissioners Meeting (RDKB) December 2024 in Jakarta, revealed that this development was part of efforts to advance the sharia financial sector.
Sharia Unit Separation Process
Mirza explained that one of the sharia units of the life insurance company had obtained an operational license as a sharia life insurance company. Currently, the process of transferring the portfolio from the sharia unit to the new company is underway. Meanwhile, the sharia unit of the general insurance company has completed the portfolio transfer to the existing sharia insurance company.
This RKPUS is a mandatory step regulated in Article 9 of OJK Regulation (POJK) Number 11 of 2023 concerning the Separation of Sharia Units for Insurance Companies and Reinsurance Companies. This regulation provides technical guidance to ensure the separation process runs in accordance with the provisions.
Performance of the Sharia Financial Sector
On the other hand, the Islamic finance industry shows positive performance. The Indonesian Sharia Stock Index (ISSI) recorded an increase of 1.41 percent year to date (ytd). Intermediation performance in the sharia financial services sector also grew significantly. Sharia banking financing increased by 11.26 percent year on year (yoy), sharia insurance contributions grew 8.42 percent (yoy), and sharia financing receivables recorded growth of 11.90 percent (yoy).
Sharia Unit Separation Method
Based on POJK Number 11 of 2023, there are two methods that insurance or reinsurance companies can use to separate their sharia units:
- Establishing a New Company: Companies can establish new sharia insurance or sharia reinsurance companies. This process involves the separation of the sharia unit followed by the transfer of the membership portfolio to the new company.
- Portfolio Switching: The entire sharia unit membership portfolio can be transferred to a sharia insurance or sharia reinsurance company that already has a business license.
In carrying out this separation, insurance and reinsurance companies are required to fulfill all the requirements set by the OJK. This step is expected to encourage the development of a more inclusive and competitive sharia financial sector.
BPJS Health Clarification regarding Employees Using Private Insurance
Recently, BPJS Health has been in the spotlight on social media after information about its employees using private health insurance services went viral. Responding to this, the Chief Assistant Deputy for Public Communications and Public Relations of BPJS Health, Rizzky Anugrah, provided an official explanation.
Rizzky explained that BPJS Health gives its employees the freedom to use private health insurance products, even though they already receive health facilities from BPJS Health itself. BPJS Health employees automatically become participants in the National Health Insurance (JKN) program, with a contribution scheme of 4 percent covered by the office and 1 percent deducted from the employee’s salary.
“All employees are participants in the JKN program and can use this service if they need health care,” explained Rizzky in a statement given to iNews.id, Wednesday (8/1/2025).
Additional Insurance for Personal Expenses
Employees who choose to use private insurance outside of JKN services are permitted, but the premium costs for this insurance are entirely the personal responsibility of each employee. This is in line with Presidential Regulation Number 59 of 2024, which is the third amendment to Presidential Regulation Number 82 of 2018 concerning Health Insurance.
In this regulation, Article 51 Paragraph (1) regulates that employees can increase treatment facilities beyond the basic rights guaranteed by JKN. This includes services such as executive outpatient care or other facility upgrades, provided you use additional insurance or cover the difference in higher service costs yourself.
“If there are employees who want to have one or two additional private insurances, that is welcome, but the costs must be borne independently,” added Rizzky.
Previously Discussed Issues
Rizzky also revealed that a similar topic had received attention in 2016. At that time, BPJS Health had provided the same clarification regarding this policy. “This issue actually appeared in 2016 and was clarified by BPJS Health at that time,” he said.
This policy reflects BPJS Health’s flexibility in accommodating the needs of its employees, while complying with applicable regulations. With this policy, BPJS Health employees still have the option to improve their health facilities through additional insurance, as long as they follow the stipulated provisions.
Vehicle Insurance Protection from Damage Due to Chemical Liquids
Vehicle damage caused by external chemical fluids, which do not come from the vehicle owner’s belongings, can apparently be covered by insurance. Laurentius Iwan Pranoto, Head of PR, Marcomm, & Events Astra Insurance, explained that having vehicle insurance provides very important additional protection. Insurance not only protects the vehicle but also provides a sense of security for the owner from unexpected risks.
“Car insurance is a wise step to deal with risks that can be detrimental, although some incidents can be avoided with preventive measures. An example is the case of vehicle damage caused by chemical liquids,” said Iwan in his official statement, Thursday (9/1/2025).
According to him, if the vehicle is damaged due to chemical liquids such as caustic soda or paint originating from outside the vehicle, the owner can submit an insurance claim. This is in accordance with the provisions in the Indonesian Motor Vehicle Insurance Standard Policy (PSAKBI). However, if the chemical liquid is luggage or is loaded in a vehicle, then the damage is not covered by insurance.
Provisions in the Insurance Policy
Based on PSAKBI CHAPTER II Article 3 Paragraph 2 number 2.2, insurance coverage does not cover loss or damage caused by chemicals, water or other liquids in the vehicle, unless the damage is the result of a risk covered by the policy.
To ensure claims can be processed, there are several things you need to pay attention to:
- Document Liveness: Make sure the vehicle insurance policy, driver’s license and STNK are still valid.
- Police Report: Complete with a certificate from the local police.
- Compliance with Traffic Rules: Do not violate the rules, such as crossing the road shoulder or exceeding the speed limit.
- Suitability of Vehicle Use: If a vehicle insured for personal use is used as a rental or rental vehicle, claims will not be covered.
- Driver Condition: The driver must not be under the influence of alcohol or illegal drugs.
The Importance of Understanding Police Provisions
Iwan emphasized the importance of thoroughly understanding the policy provisions, including guaranteed risks, extended guarantees, and applicable exclusions. With good understanding, vehicle owners can make optimal use of insurance protection and minimize the risk of claim rejection.
With the right insurance protection, vehicle owners can feel calmer when facing the risk of unexpected losses, including incidents involving chemical fluids from outside the vehicle.
OJK Encourages Insurance and Pension Fund Reform to Contribute to the National Economy
The Financial Services Authority (OJK) continues to strive for the transformation of the insurance, guarantee and pension fund (PPDP) sector in order to strengthen its contribution to the national economy while increasing public trust. Chief Executive of the OJK Insurance, Guarantee and Pension Fund Supervision, Ogi Prastomiyono, revealed that the transformation steps include regulation, development, licensing and supervision.
“This transformation was designed by considering the interests of consumers, industry and a macroeconomic perspective so that it has a positive impact on the country,” said Ogi, quoted on Tuesday, October 8 2024.
Ogi explained that OJK had taken strategic steps to deal with various issues in this sector, one of which was by resolving the problems of problematic companies. OJK also emphasizes the importance of open communication with the public and taking firm steps oriented towards consumer protection.
The main focus in strengthening the PPDP sector includes increasing capital and market deepening, improving governance and risk management, strengthening the sector ecosystem, and implementing best practices based on international standards. In this framework, OJK shows its commitment to support the implementation of the Financial Sector Development and Strengthening Law (UU P2SK).
In 2023, OJK has issued ten OJK Regulations (POJK) in this sector and plans to issue ten more POJKs in 2024, including several OJK Circular Letters (SEOJK) to provide technical guidance. “For 2025, OJK has mapped out the issuance of POJK that supports further transformation in this sector,” added Ogi.
In order to strengthen internally, OJK is also developing a technology-based information system to support supervision. One of the initiatives is the IKNB Securities Information and Monitoring Portal (PRIME), which is designed to provide integrated supervision in the insurance, guarantee and pension fund sectors. In addition, OJK is building a database of national insurance policy holders and pension fund members, which will enable in-depth data analysis to strengthen supervision, research and decision making.
“We are also focusing on strengthening capital in the insurance sector through the implementation of POJK 23/2023 concerning Business Licensing and Insurance Institutions, which regulates gradual increases in capital until 2026 and 2028,” explained Ogi.
In addition, OJK has simplified the approval and reporting process for insurance products to increase efficiency. In terms of supervision, an end-to-end approach is applied to strengthen supervision using a layered method. OJK is also preparing to implement PSAK 117, strengthen the reporting system, and delegate supervisory authority to regional offices to strengthen relations between industry and supervisors.
The transformation carried out by the OJK is expected to be able to provide a stronger, more transparent and competitive insurance, guarantee and pension fund sector, while providing maximum protection for consumers.
OJK’s Optimism in Implementing PSAK 117 in the Insurance Industry
The Financial Services Authority (OJK) is optimistic that insurance and reinsurance companies in Indonesia are ready to implement Statement of Financial Accounting Standards (PSAK) 117 starting January 1 2025. This belief is supported by OJK records which show that more than 95 percent of companies have submitted reports parallel run PSAK 117 for quarters I, II and III of 2024.
“Presentation of the report parallel run “This indicates adequate readiness of insurance and reinsurance companies in implementing PSAK 117 in 2025,” said the Chief Executive of the OJK Insurance, Guarantee and Pension Fund Supervisor, Ogi Prastomiyono, in a press conference on the results of the OJK Board of Commissioners Meeting, December 2024 in Jakarta.
As part of regulatory support, OJK has issued POJK Number 22 of 2024 which regulates the obligation to submit quarterly financial reports based on PSAK 117 during 2025. For the first report, companies are required to submit it no later than 45 days after the end of the first quarter of 2025, namely on May 15 2025 Meanwhile, for 2026 and beyond, the deadline for submitting quarterly reports will be shortened to 30 days.
OJK’s Steps in Supporting the Implementation of PSAK 117
As part of implementation preparations, OJK also issued SEOJK Number 23/SEOJK.05/2024 on 24 December 2024. This regulation regulates the form and structure of periodic reports which will soon be disseminated further to the industry.
On December 20 2024, OJK will hold a high-level meeting High-Level Meeting Steering Committee to discuss the implementation of PSAK 117. The results of this meeting confirmed OJK’s coordination with the Ministry of Finance (Kemenkeu), including the Directorate General of Taxes, the Financial Accounting Standards Board (DSAK IAI), and the Indonesian Actuaries Association (PAI), in preparing technical guidelines. This guide covers the format bridging and conversion of the PSAK 117 report into the agency’s annual SPT report format.
“The Directorate General of Taxes has accommodated this process, and it is hoped that the guidelines prepared can be used effectively by industry players,” said Ogi.
Coordination with Various Associations
OJK is also collaborating with the Indonesian Institute of Public Accountants (IAPI) and the Association of Indonesian Actuarial Consulting Firms (AKKAI) to ensure that the audit of financial statements for the 2025 financial year based on PSAK 117 can be carried out properly.
For sharia insurance, the company will use PSAK 408 which has been modified and is currently being drafted by DSAK. Meanwhile, for social insurance, OJK is still waiting for regulations from the government in the form of Minister of Finance Regulations (PMK) or government regulations regarding social insurance accounting.
Commitment Towards Better Governance
Through various strategic steps and cross-sector coordination, OJK shows its commitment to supporting the transformation of the insurance and reinsurance industry. With the implementation of PSAK 117, it is hoped that insurance company governance in Indonesia will become stronger, provide better protection to consumers, and contribute positively to the national economy.
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