The Minister of Finance has issued a draft regulation that once enacted will repeal and replace an earlier Ministerial Decision, No. 423/KMK.06/2003, on Investigations of Insurance Companies. The amendments to the decision proposed in the draft are in bold in the draft that is attached to this ILB.
The amended regulation includes additional definitions for loss insurance, life insurance, and insurance brokers.
The most significant amendments relate to investigations. Currently, the decision requires that investigations be done periodically. However, the amended regulation requires that the periodic investigations be in both direct and indirect formats. The direct form is to be done by notifying both the Capital Market and Financial Institutions Supervisory Agency (Bapepam-LK) and the insurance company of the intent to investigate. Indirect investigations are to be carried out by the insurance bureau. The investigations can also take place as required.
The scope of investigations has been broadened to include all aspects related to the object and purpose of the investigation. Therefore, matters relating to financial, operational, and management issues can be investigated. Furthermore, matters relating to systems and procedures may also be subject to investigation.
A letter authorizing an investigation is required before an investigation can take place.
It is expected that the amended regulations will also enhance protections for insurance consumers.
The Minister of Finance has issued a draft regulation that once enacted will repeal and replace an earlier Ministerial Decision, No. 423/KMK.06/2003, on Investigations of Insurance Companies. The amendments to the decision proposed in the draft are in bold in the draft that is attached to this ILB.
The amended regulation includes additional definitions for loss insurance, life insurance, and insurance brokers.
The most significant amendments relate to investigations. Currently, the decision requires that investigations be done periodically. However, the amended regulation requires that the periodic investigations be in both direct and indirect formats. The direct form is to be done by notifying both the Capital Market and Financial Institutions Supervisory Agency (Bapepam-LK) and the insurance company of the intent to investigate. Indirect investigations are to be carried out by the insurance bureau. The investigations can also take place as required.
The scope of investigations has been broadened to include all aspects related to the object and purpose of the investigation. Therefore, matters relating to financial, operational, and management issues can be investigated. Furthermore, matters relating to systems and procedures may also be subject to investigation.
A letter authorizing an investigation is required before an investigation can take place.
It is expected that the amended regulations will also enhance protections for insurance consumers.
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