OJK: Business Actors Can't Close Their Eyes On Insurance Sector Problems

JAKARTA - The Financial Services Authority (OJK) stated that market participants cannot turn a blind eye to various issues and problems in the insurance sector.

Chief Executive of OJK Insurance Insurance and Pension Fund Ogi Prastomiyono explained, for example, the penetration rate and density of Indonesia's insurance sector are still lagging behind. This is when compared to several other countries, including in Asia.

"From the perspective of business actors, we cannot turn a blind eye to the various issues and problems that are still being faced by the insurance sector," he said, quoting Antara, Thursday, October 12.

Meanwhile, from a consumer perspective, the trend of consumer complaints related to the insurance sector is still relatively high.

In the period January 1 to September 30, 2023, there were around 1,271 complaints that could potentially have a negative impact on the reputation risk of the insurance sector and drain public confidence in the insurance sector.

Some of the problems that occur in the insurance sector are general symptoms that arise due to the weakness of insurance companies to carry out prudent and accountable business activities in the main business process, such as product development and monitoring, marketing, underwriting, investment management, and recording financial reports.

For this reason, he continued, one of the main focuses of the OJK is to encourage the strengthening of technical competencies in the company, especially the existence and effectiveness of actuaries.

"Strengthening technical competencies such as actuaries plays a strategic role to support the implementation of effective government risk and compliance functions in terms of technical implementation of insurance business activities," said Ogi.

In this regard, the OJK continues to enforce the provisions regarding the existence of appointed actuary in insurance and reinsurance companies which are met no later than the end of December 2023. (That way), in 2024 all insurance and reinsurance companies will have an approved actuary, "he said.