Indonesia’s Financial Services Authority (OJK) is promoting the introduction of compulsory insurance for the public.
Ogi Prastomiyono, Chief Executive of the Insurance, Financial Institutions and Pension Fund Supervision Agency, has said that the initiative aims to ensure that mandatory insurance is in place, particularly for large gatherings that involve a large number of people, such as football matches.
“There is no insurance for such events because it’s not compulsory. As we can see from the Kanjuruhan case, there was no insurance after the investigation,” he said in a Tempo report. “If insurance were mandatory, the tickets could include Rp50,000 for insurance.”
This approach is not limited to public gatherings, as the OJK intends to encourage similar mandates in other sectors, particularly transport. At present, insurance for passengers is facilitated by Jasa Raharja, but the move towards mandatory insurance for vehicles is on the horizon.
If this initiative is implemented, insurance companies are likely to introduce new products or partner with other companies to provide the necessary coverage. Prastomiyono said this approach will increase insurance penetration and provide protection for citizens while protecting companies from potential losses or future risks.
Elsewhere in the country, AM Best has maintained its negative outlook on Indonesia’s non-life insurance sector, citing increased reinsurance credit risk and potential pressure on underwriting margins.
