OJK Confirms Insurance Industry Preparedness for Potential PPP Acceleration

Regulatory Context and Industry Readiness

The Financial Services Authority (OJK) has assured that the Indonesian insurance industry is fully prepared to implement the Policy Guarantee Program (PPP) ahead of schedule in 2027, rather than the original 2028 timeline mandated by Law No. 4/2023 on Financial Sector Development and Strengthening (P2SK). Ogi Prastomiyono, OJK's Executive Head of Insurance, Guarantee, and Pension Fund Supervision, emphasized that if the law requires acceleration, all stakeholders must be ready to comply.

Legal Framework and Current Developments

The original implementation deadline for the PPP is January 2028 as stipulated by the P2SK Law. However, the law is currently under revision, leaving room for potential adjustments to the timeline. The OJK maintains that the insurance industry has shown readiness to adapt to the accelerated implementation should it be mandated by the revised legislation.

Implications for the Insurance Sector

The Policy Guarantee Program is designed to enhance consumer protection in the insurance industry by providing a safety net for policyholders. Accelerating the program to 2027 would demonstrate the government's commitment to strengthening the financial sector and improving market confidence. The OJK's oversight will be crucial in ensuring a smooth transition and successful implementation of the program.