BANDUNG - The Deposit Insurance Corporation (LPS) said there was an opportunity to accelerate the implementation of the insurance Policy Guarantee Program (PPP) in 2027. Just so you know, this program was originally targeted to be implemented in 2028.
Member of the Board of Commissioners for PPP LPS, Ferdinand D. Purba stated, in fact, PPP will be formalized through Government Regulations (PP). This rule will be equipped with technical provisions such as guarantee boundary values and guaranteed types of products will be determined further.
"According to the P2SK Law, this program will start running in 2028. If it is accelerated in 2027, LPS is ready to implement (PPP)," said Purba in Bandung, Saturday, December 6.
Purba said, the acceleration of the implementation of PPP could be carried out if the Draft Amendment to the P2SK Law could be stipulated in 2025 and the related PP draft could be issued at the end of the first quarter of 2026.
Purba explained that currently LPS has prepared three types of guarantees in PPP, including policy claim guarantees, if the insurance company has problems, LPS will guarantee full and partial claim payments.
The second scheme is the transfer of policy portfolios to healthy companies, where customer policies continue to run with the same benefits.
The last scheme, policy return. This can be done by LPS if the policy transfer cannot be carried out, in this scheme LPS will pay for the policy according to the guarantee limit.
The guarantee is estimated to cover a coverage value of between IDR 500 million, which Purba says covers about 90 percent of the average policy value in Indonesia.
"This scheme will be automatically carried out by LPS without the need for options from policyholders," he added.
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Purba also said that PPP would be formalized through Government Regulations (PP), with technical provisions such as the value of the guarantee limit and the type of products guaranteed to be determined further. According to the P2SK Law, this program will start running in 2028. However, LPS stated that it was ready if there was an acceleration to 2027.
"If it is accelerated in 2027, LPS is ready to implement it," said Purba.
Purba also emphasized that if this program runs, public trust in the insurance industry will increase. As a result, the insurance industry premium will increase.
"The existence of PPP is part of the recovery and resolution framework to deal with the possibility of failure of insurance companies, based on the experience of LPS so far in running the savings guarantee program, public trust in banking increases. Third party funds (DPK) for banks also increased," he explained.
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