A corruption case involving then executives of state-owned insurer PT Asuransi Jiwasraya (Persero) culminated in the company’s failure to pay out IDR 16 trillion (USD 1.1 billion) in matured policies due in October and November 2018.
The case garnered significant public attention until it sank from the headlines following the outbreak of the Covid-19 pandemic in 2020. However, it was only one of a series of similar cases down the years that have left the Indonesian public jittery about the country’s insurance industry, especially life insurance.
In mid-2023, the Indonesian Financial Services Authority (Otoritas Jasa Keuangan / “OJK”) revealed that at least 13 insurance companies had been placed under supervision in relation to payment defaults on matured policies to customers. This prompted the OJK to launch its “Restoring Confidence through Industry Reform” initiative on 23 October 2023, which includes a 2023-2027 roadmap for the development and consolidation of Indonesia’s insurance industry. In line with this roadmap, the OJK recently issued Regulation No. 23 of 2023 on the Licensing and Strengthening of Insurance, Sharia Insurance, Reinsurance and Sharia Reinsurance Companies (“Reg. 23”)
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This ABNR News and its contents are intended solely to provide a general overview, for informational purposes, of selected recent developments in Indonesian law. They do not constitute legal advice and should not be relied upon as such. Accordingly, ABNR accepts no liability of any kind in respect of any statement, opinion, view, error, or omission that may be contained in this legal update. In all circumstances, you are strongly advised to consult a licensed Indonesian legal practitioner before taking any action that could adversely affect your rights and obligations under Indonesian law.
