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Ada Pertanyaan? Hubungi Kami Fathan Qorib, Yanuar Pribadhie
The Financial Services Authority (OJK) has issued Circular Letter No. 06/D.05/2013 on the Determination of Tariff Premiums and Acquisition Cost Provisions for the Property and Motor Vehicle Sectors including Special Risks covering Floods, Earthquakes, Volcanic Eruptions, and Tsunami. OJK issued the Circular on 31 December 2013, following several discussions with the Indonesian General Insurance Association (AAUI).
Firdaus Djaelani, Chief Executive of OJK’s division for Supervision of the Non-Bank Financial Industry, explained that the Circular regulates limits on the maximum and minimum tariff premiums to prevent unfair business competition between insurance and reinsurance companies with a concurrent objective of protecting consumers.
“Additionally, the Circular will also reduce the current account deficit in the reinsurance sector. Twenty years ago, this sector had a deficit of up to IDR 250 million. We noticed that this number is growing,” said Firdaus last Friday.
Firdaus based his calculations on the rates for premiums for policies transferred by national insurance companies to overseas reinsurance companies. Despite insurance claims by overseas’ insurance companies being considerably low, if certain aspects of the current system are properly regulated, the deficit will swell.
Since January 2014, the Circular also applies to finance and banking companies involved in the processing business for the insurance sector. Firdaus hopes that all relevant parties will immediately make adjusts to conform to the Circular as failure to do so may result in the imposition of penalties.
“They may be subjected to a temporary ban for selling insurance products or the executives may have to pass a fit and proper test if the mistakes are repeated,” said Firdaus.
Julian Noor, AAUI’s Executive Director, welcomed the Circular. He believes that the Circular will put an end to unfair tariff competition among insurance companies.
“Tariff competition potentially hampers policy holders because the insurance companies may not be able to provide the benefits provided. We hope that the Circular will be the catalyst for the beginning of sound competition in the insurance business,” said Julian.
(hot/kc)
The Financial Services Authority (OJK) has issued Circular Letter No. 06/D.05/2013 on the Determination of Tariff Premiums and Acquisition Cost Provisions for the Property and Motor Vehicle Sectors including Special Risks covering Floods, Earthquakes, Volcanic Eruptions, and Tsunami. OJK issued the Circular on 31 December 2013, following several discussions with the Indonesian General Insurance Association (AAUI).
Firdaus Djaelani, Chief Executive of OJK’s division for Supervision of the Non-Bank Financial Industry, explained that the Circular regulates limits on the maximum and minimum tariff premiums to prevent unfair business competition between insurance and reinsurance companies with a concurrent objective of protecting consumers.
“Additionally, the Circular will also reduce the current account deficit in the reinsurance sector. Twenty years ago, this sector had a deficit of up to IDR 250 million. We noticed that this number is growing,” said Firdaus last Friday.
Firdaus based his calculations on the rates for premiums for policies transferred by national insurance companies to overseas reinsurance companies. Despite insurance claims by overseas’ insurance companies being considerably low, if certain aspects of the current system are properly regulated, the deficit will swell.
Since January 2014, the Circular also applies to finance and banking companies involved in the processing business for the insurance sector. Firdaus hopes that all relevant parties will immediately make adjusts to conform to the Circular as failure to do so may result in the imposition of penalties.
“They may be subjected to a temporary ban for selling insurance products or the executives may have to pass a fit and proper test if the mistakes are repeated,” said Firdaus.
Julian Noor, AAUI’s Executive Director, welcomed the Circular. He believes that the Circular will put an end to unfair tariff competition among insurance companies.
“Tariff competition potentially hampers policy holders because the insurance companies may not be able to provide the benefits provided. We hope that the Circular will be the catalyst for the beginning of sound competition in the insurance business,” said Julian.
(hot/kc)
Fathan Qorib, Yanuar Pribadhie
The Financial Services Authority (OJK) has issued Circular Letter No. 06/D.05/2013 on the Determination of Tariff Premiums and Acquisition Cost Provisions for the Property and Motor Vehicle Sectors including Special Risks covering Floods, Earthquakes, Volcanic Eruptions, and Tsunami. OJK issued the Circular on 31 December 2013, following several discussions with the Indonesian General Insurance Association (AAUI).
Firdaus Djaelani, Chief Executive of OJK’s division for Supervision of the Non-Bank Financial Industry, explained that the Circular regulates limits on the maximum and minimum tariff premiums to prevent unfair business competition between insurance and reinsurance companies with a concurrent objective of protecting consumers.
“Additionally, the Circular will also reduce the current account deficit in the reinsurance sector. Twenty years ago, this sector had a deficit of up to IDR 250 million. We noticed that this number is growing,” said Firdaus last Friday.
Firdaus based his calculations on the rates for premiums for policies transferred by national insurance companies to overseas reinsurance companies. Despite insurance claims by overseas’ insurance companies being considerably low, if certain aspects of the current system are properly regulated, the deficit will swell.
Since January 2014, the Circular also applies to finance and banking companies involved in the processing business for the insurance sector. Firdaus hopes that all relevant parties will immediately make adjusts to conform to the Circular as failure to do so may result in the imposition of penalties.
“They may be subjected to a temporary ban for selling insurance products or the executives may have to pass a fit and proper test if the mistakes are repeated,” said Firdaus.
Julian Noor, AAUI’s Executive Director, welcomed the Circular. He believes that the Circular will put an end to unfair tariff competition among insurance companies.
“Tariff competition potentially hampers policy holders because the insurance companies may not be able to provide the benefits provided. We hope that the Circular will be the catalyst for the beginning of sound competition in the insurance business,” said Julian.
(hot/kc)
The Financial Services Authority (OJK) has issued Circular Letter No. 06/D.05/2013 on the Determination of Tariff Premiums and Acquisition Cost Provisions for the Property and Motor Vehicle Sectors including Special Risks covering Floods, Earthquakes, Volcanic Eruptions, and Tsunami. OJK issued the Circular on 31 December 2013, following several discussions with the Indonesian General Insurance Association (AAUI).
Firdaus Djaelani, Chief Executive of OJK’s division for Supervision of the Non-Bank Financial Industry, explained that the Circular regulates limits on the maximum and minimum tariff premiums to prevent unfair business competition between insurance and reinsurance companies with a concurrent objective of protecting consumers.
“Additionally, the Circular will also reduce the current account deficit in the reinsurance sector. Twenty years ago, this sector had a deficit of up to IDR 250 million. We noticed that this number is growing,” said Firdaus last Friday.
Firdaus based his calculations on the rates for premiums for policies transferred by national insurance companies to overseas reinsurance companies. Despite insurance claims by overseas’ insurance companies being considerably low, if certain aspects of the current system are properly regulated, the deficit will swell.
Since January 2014, the Circular also applies to finance and banking companies involved in the processing business for the insurance sector. Firdaus hopes that all relevant parties will immediately make adjusts to conform to the Circular as failure to do so may result in the imposition of penalties.
“They may be subjected to a temporary ban for selling insurance products or the executives may have to pass a fit and proper test if the mistakes are repeated,” said Firdaus.
Julian Noor, AAUI’s Executive Director, welcomed the Circular. He believes that the Circular will put an end to unfair tariff competition among insurance companies.
“Tariff competition potentially hampers policy holders because the insurance companies may not be able to provide the benefits provided. We hope that the Circular will be the catalyst for the beginning of sound competition in the insurance business,” said Julian.
(hot/kc)