INDONESIA: BANCASSURANCE TO ATTRACT MORE REGULATIONS
Source: Asia Insurance Review, 23 June 2014
Commission-based income generated from bancassurance has led to more banks establishing partnerships with insurance companies, with many of them including the business in their strategic plans. The increasing popularity of bancassurance has attracted the attention of the financial regulators who are planning to introduce more rules for this distribution channel. Up to April this year, 1,074 bancassurance agreements between banks and insurance companies had been signed, reported the Jakarta Post citing the Financial Services Authority (OJK). As many as 40 banks have established partnerships with 26 life insurance companies, while another 67 banks have tied up with 23 general insurance companies. Data from the OJK shows that 970 bancassurance products are now on the market, 943 of which are conventional bancassurance products — comprising 208 life insurance products and 735 general insurance products. Bancassurance products with Shariah principles stand at 27, comprising 19 life insurance and eight general insurance products.