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Tugure Highlights Challenges and Strategies for Developing Credit Life Insurance at IUS 2024

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16 Aug 2024
Tugure Highlights Challenges and Strategies for Developing Credit Life Insurance at IUS 2024

JAKARTA – PT Tugu Reasuransi Indonesia (Tugure) actively participated in the 2024 Indonesia Underwriting Summit (IUS), organized by the Indonesian Life Underwriter Association (Peruji). Not only serving as a sponsor, Tugure also played a key role in discussing the ins and outs of Credit Life Insurance (AJK) products, including the challenges of implementing POJK 20/2023, which regulates these products.

Kiki Oditya, Life Group Head at Tugure, was one of the main speakers at IUS 2024, where she discussed the topic of AJK. She highlighted that the management of AJK products currently faces several challenges.

“While the AJK business offers high-profit potential, it also carries significant risk of loss,” said Kiki in her presentation at IUS 2024 in Jakarta on Thursday (August 15, 2024).

Kiki emphasized that as the implementation deadline for POJK 20/2023 approaches, insurance companies must overhaul the governance of AJK products. Key aspects that the insurance industry must address regarding AJK include the role of actuaries, who must provide precise calculations for the entire duration of the policy.

“The role of actuaries is critical in supporting underwriters,” she added.

Kiki also stressed the importance of insurance companies having a clear risk appetite, supported by strong underwriting guidelines that are regularly updated. This is to ensure that underwriters within the company have consistent standards.

“All parties, from management to actuaries and underwriters, must have a unified risk appetite. Underwriters must provide valuable insights to relevant stakeholders,” explained Kiki.

Furthermore, Kiki stated that in order to develop a healthy AJK product, commitment from all stakeholders is necessary, including business sources, brokers, insurers, and reinsurers. According to her, strong synergy among stakeholders is crucial for creating sustainable business practices. She also highlighted the need for improvements in the claims process. She stressed that insurance companies must have efficient and transparent claims systems, from document management to evaluation steps.

“The use of technology in the claims process is crucial to reduce delays and minimize manual errors,” said Kiki.

Drawing from Tugure's experience, Kiki encouraged insurance companies to have investigative capabilities, both through internal and external teams, to prevent fraud.

“This approach has proven effective in reducing claims at Tugure,” she added. Currently, at Tugure, the AJK product is still in the modeling and discussion phase with all business partners to create a product that is beneficial for both Tugure and its partners.

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