Pursuant to some news, the government supports the development of InsurTech, as it will help the insurance companies to promote about their products and raise the awareness of Indonesian people about the importance of insurances. Following the issuance of the recent BI Regulations on Fintech near the end of 2017, it indicates that the regulator is starting to allow the growth of financial technology in InsurTech (as explained in “Legal affair” section below).
Under the BI Regulations on Fintech, financial technology operator which (i) has or will conduct activity that fulfil criteria as “financial technology” operator, or (ii) under the supervision of other authority that conducts financial technology in payment system activity, shall register itself to BI. The activity of financial technology operator includes, among others, the investment management and risk management. Furthermore it was mentioned under BI Regulations on Fintech the example of financial technology in the form of investment management and risk management shall be the provision of online investment product or online insurance.
Please see detailed explanation on Part “1. Payment Service / Mobile Payment”, particularly on “Legal Affairs” part, regarding the registration, Regulatory Sandbox and licensing stage.
Pursuant to the scope of services mentioned above, we understand that the fintech company wants to act as an insurance broker or as a data collector for insurance products in Indonesia. By considering that the scope of service as explained herein can be considered as the provision of online insurance, then it is possible for the business player to firstly register to BI as financial technology operator and follow the determined procedures i.e. registration, Regulatory Sandbox and licensing.
Considering the development of fintech insurance company in Indonesia which will make the insurance provision become easier, it is expected that the business of InsurTech service may expand in the future.