OJK Uncovers 15 Illegal Insurance Brokerage Firms Operating in Indonesia
The Financial Services Authority (OJK) has revealed that 15 companies are indicated to be operating insurance brokerage businesses without a licence. The OJK will take firm action against these findings through a legal enforcement process that is currently underway.
Chief Executive of Insurance, Guarantee, and Pension Fund Supervision at the OJK, Ogi Prastomiyono, stated that there are currently 191 brokerage firms registered with the OJK. The breakdown consists of 150 insurance brokerage firms and 41 reinsurance brokerage firms.
Ogi explained that every brokerage firm is required to employ at least one broker who has been registered through the Professional Certification Institute (LSP) and licensed by the OJK.
‘The OJK is still finding parties carrying out activities resembling insurance brokerage by employing insurance agents but conducting insurance brokerage activities. Legal enforcement is being carried out, and to date, there are 15 companies indicated to be conducting insurance brokerage business without a licence,’ Ogi said during the OJK Board of Commissioners Meeting press conference on Tuesday.
Currently, the cases of these 15 companies have been handled by OJK investigators, ranging from the inquiry and investigation stages, with some having already entered the trial process.
In addition to taking action against companies suspected of operating without a licence, the OJK is also taking supervisory action against insurance companies that have cooperated with unlicensed brokers. The OJK has carried out supervisory action by requesting the termination of such cooperation and imposing administrative sanctions on the violating parties.
On another front, the OJK is strengthening supervision through the implementation of QR Code verification on Registration Certificates (STTD). Through this system, the public and industry players can verify the status of brokers in real time, thereby minimising potential losses due to the use of unlicensed brokers.
The OJK is also requiring all insurance brokerage and reinsurance brokerage firms to re-register all employed brokers to obtain QR Code-based STTDs. This process is currently ongoing, with 434 brokers having been registered.