rizkysmg – The Deposit Insurance Agency (LPS) has appointed Jarot Marhaendro as the Executive Director of Surveillance, Data, and Insurance Inspection in preparation for the implementation of the Insurance Policy Guarantee Program (PPP) in 2028, as mandated by Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector (P2SK).
Jarot stated that LPS will guarantee both life insurance, general insurance, and Sharia insurance within the framework of the insurance policy guarantee program. “So, both conventional and Sharia insurance will be covered by the policy guarantee. We are ready to provide the guarantee,” he said during the Press Conference on LPS Insurance Guarantee Interest Rates on Friday (September 29, 2023).
It is worth noting that previously, Deputy Chairman of the LPS Commissioner Board, Lana Soelistianingsih, mentioned that the insurance policy guarantee program applied to life insurance and general insurance, excluding Investment-Linked Insurance Products (PAYDI) or unit-linked products.
“For the initial stage, the guarantee will be specifically provided for life insurance and general insurance, pure life insurance without any links to unit-linked products,” she said, as quoted from the OJK YouTube channel on Friday (September 29, 2023).
Lana explained that the guarantee would be provided if the insurance company defaults, and the policy claim has matured. LPS will pay the matured claims up to the maximum coverage.
“It must have a maximum because it cannot cover the entire amount,” she added.
Lana also mentioned that if the policy claims have not matured, LPS will transfer the policies to financially healthy insurance companies.
Meanwhile, LPS needs to prepare new members of the Commissioner Board, at the latest by 2027, to lead this program. The Chairman of the LPS Commissioner Board, Purbaya Yudhi Sadewa, revealed that the appointment of Commissioner Board members responsible for insurance guarantee would go through the President and the Parliament (DPR), a process similar to that applied to the Financial Services Authority (OJK) and the Central Bank (BI).
