Update COVID-19 in Indonesia: 365,240 confirmed infections, 12,617 deaths (19 October 2020)
19 October 2020 (closed)
USD/IDR (14,738) +41.00 +0.28%
EUR/IDR (17,395) -10.41 -0.06%
Jakarta Composite Index (5,126.33) +22.92 +0.45%
Following the enactment of the ASEAN Economic Community (AEC) in 2015, the Financial Services Authority (OJK) will allow foreign insurance corporations to open a branch office in Indonesia. The AEC will transform the ASEAN region into a region with free movement of goods, services, investment, skilled labour, as well as a freer flow of capital. Currently, foreign insurance corporations are prohibited from opening a branch in Indonesia unless it is in the form of a joint venture company with a 80 percent foreign ownership limit.
Firdaus Djaelani, official at the OJK, said that, although the regulator will allow increased foreign investment in Indonesia's insurance sector, it is still trying to make some further arrangements. The topic is on the agenda to be discussed among the OJK and insurance regulators of other Southeast Asian countries. These further arrangements aim to avert the possibility that an insurance branch is opened by a foreign company that is not in a healthy condition (for example through the setting of a minimum capital requirement). Similarly, when an Indonesian insurance company wants to open branches in other ASEAN countries, it will need to face the same regulatory framework.
Currently, there are 18 joint ventures active in Indonesia's life insurance industry (from a total of 44 entities) and also 18 in Indonesia's general insurance industry (from a total of 64 entities).