OJK Strengthens Insurance Industry With Issuance Of Product Rules

Head of the Department of Literacy, Financial Inclusion and OJK Communications Aman Santosa. (Photo: Doc. Antara)

JAKARTA - The Financial Services Authority (OJK) continues to strive to create a strong, sustainable, and innovative insurance industry, among others through the issuance of rules related to its insurance products and marketing channels.Head of the Department of Literacy, Financial Inclusion, and Communication of OJK Aman Santosa in Jakarta, Wednesday 5 June, said that the regulation is in the form of OJK Regulation (POJK) Number 8 of 2024 concerning Insurance Products and Insurance Product Marketing Channels that support and facilitate insurance business actors."POJK 8 of 2024 is effective starting on October 29, 2024 and it is hoped that insurance business actors will have sufficient time to make preparations so that this POJK can be implemented effectively and empowered for the development of the insurance industry," said Aman, quoted from Antara. The is a follow-up to the mandate in Law Number 4 of 2023 concerning Financial Sector Development and Strengthening (PPSK) which mandates the need for adjustments to POJK Number 23/POJK.05/2015 concerning Insurance Products and Insurance Products (POJK 23 of 2015), namely the strengthening of the legal base in terms of the management of insurance products better. Through POJK 8 of 2024, OJK hopes that the simplification of the insurance product approval process, the use of insurance policies electronicly or digitally and premium calculation governance or more carefully contributions can be implemented properly so that the implementation of insurance products can be felt benefits by the wider community, especially so that the insurance industry in the financial services sector has global competitiveness and can compete in a healthy manner. Some of the provisions regulated in POJK 8 of 2024 include the main strengthening of arrangements regarding the implementation of PAYDI, which was previously regulated only in OJK Circular, simplification of insurance product agreement mechanisms and reporting of insurance products, strengthening of arrangements regarding the implementation of digital insurance products. The provisions regulated are also in the form of additional arrangements for the fulfillment of sharia principles in the administration of each insurance product; as well as strengthening of insurance product management, especially in the calculation of premium or contribution. The strengthening of insurance products is carried out, especially in the implementation of insurance procedures or contribution through structured planning.

Strengthening the governance of the implementation of insurance products is also carried out through strengthening the duties, roles, and responsibilities of the insurance product development committee, corporate actuaries and all related company management. The process of preparing POJK 8 of 2024 has involved stakeholders and considers input from the insurance company industry in a balanced manner. In addition, POJK 8 of 2024 also provides a transition period of 6 months since the POJK date was promulgated. OJK hopes that the issuance of POJK 8 of 2024 as a refinement of POJK 23 of 2015 will have a big and positive impact on the development of the insurance industry in an effort to realize the creation of a strong and overall healthy insurance industry ecosystem.