Arrest of terrorists may get RI off war-risk list

Fitri Wulandari, The Jakarta Post, Jakarta

The government expressed on Friday optimism that the encouraging progress in the investigation into the Oct. 12 Bali bombing would move the international reinsurance industry to remove Indonesia from the list of war-risk countries.

The government would not ask the industry to review the listing, but it firmly believed the industry would do so, once the international community was satisfied with the progress of the investigation, a senior official at the Ministry of Finance said.

"We cannot prevent them from putting Indonesia as a war-risk because it is a market decision," Firdaus Jaelani, director of insurance at the Ministry of Finance told The Jakarta Post.

"But if the investigation into the Bali bombing can unravel who the mastermind was, eventually, the international reinsurance market will take Indonesia off the list (war-risk labeled)," he stressed.

Firdaus said thus far, the investigation by the multinational police led by Indonesian police had demonstrated to the international community, including the international reinsurance market, that the government had taken concrete measures to step up security in the country.

In less than two months, the investigation team arrested on Thursday, Imam Samudra, the alleged leader of the gang responsible for the terror bombing in Kuta, Bali that killed more than 190 people, mostly Western holidaymakers.

Immediately after the bombing in Bali, the London-based Joint Hull Committee issued a marine hull war risks cancellation notice.

The notice, which took effect on Oct. 17, called on insurance and reinsurance firms to cancel or amend all contracts with vessels sailing to Indonesia. Additional premiums will be applied should ship operators insist on entering Indonesian waters.

Shipping operators and businessmen protested the decision as the notice immediately increased marine hull insurance premiums by 15 percent from the previous premium, which was 3 percent to 4 percent of a ship's value.

This could hamper the flows of goods in and out of the country as 94.6 percent of exported and imported goods were transported by foreign ships.

Frans Y. Sahusilawane, the chairman of the Association of Indonesian General Insurers (AAUI) said that the association had approached the government to see if the government could provide subsidies to cover war-risk insurance for boats.

"But, the government said they don't have the financial capability to do it," he said.

War-risk surcharges have also prompted foreign shipping companies to increase container fees from Indonesia to Europe and the United States.

For instance, according to the Indonesian Exporters Association (GPEI), the fee for a container measuring 20 feet long for a U.S. destination has been raised by US$500 from $2,350 to $2,850.

Meanwhile, Minister of Culture and Tourism I Gede Ardika recently complained that many insurance companies were refusing to provide personal accident insurance to travelers who want to visit Indonesia.

"That's what actually prevents effort to restore tourism in Indonesia," Ardika remarked.