Ongko Group launches life insurance company

JAKARTA (JP): The Ongko Group yesterday launched the operation of its new venture, PT Ongko Life Insurance, under a technical assistance arrangement with the united Kingdom-based insurance firm Legal & General.

"The agreement with Legal & General will help ensure Ongko's efforts to provide the protection and security that Indonesians need as the country progresses forward," the group's president, Irjanto Ongko, told journalists yesterday.

Ongko Life's president, Viven Setiabudi, said that the newly- established company has an authorized capital of Rp 2 billion (US$849,834) and a paid-up capital of Rp 10 billion.

"We have already established five branches in Jakarta with 70 sales agents," Viven said.

Viven, who used to be an executive of the publicly-listed PT Lippo Life, of the Lippo Group, said that her company will make use of the Ongko Group's nationwide financial distribution network and will operate a computerized service system, known as the Life 400 system.

The Life 400 system, which has been used by other companies like Lippo Life and Panin Life, according to Viven, allows the company to fast track new product developments.

Commenting on its distribution strength, Irjanto said that the Ongko Group's bank, Bank Umum Nasional, currently has 113 branches with total assets of Rp 6.5 trillion. The group also operates a finance company, PT Bunas Finance.

Viven said that the management has proposed launching three policies -- for scholarship savings, for multi purpose insurance and for whole life insurance.

Meanwhile, Legal & General's business director, Peter Smyth, said that his company has noticed the potential life insurance market in Indonesia but said that it needs a more conducive legal environment to grow in Indonesia.

An insurance regulation, for example, stipulates that any newly-established life insurance company should wait for two years after its establishment to set up a joint venture with foreign partners. (alo)