Amendment to Financial Services Authority Regulation Number 73/POJK.05/2016 on Good Corporate Governance for Insurance Companies

FINANCIAL SERVICES AUTHORITY
REPUBLIC OF INDONESIA
COPY
FINANCIAL SERVICES AUTHORITY REGULATION
NUMBER 43 /POJK.05/2019
CONCERNING
AMENDMENT TO THE FINANCIAL SERVICES AUTHORITY REGULATION NUMBER 73/POJK.05/2016 CONCERNING GOOD CORPORATE GOVERNANCE FOR INSURANCE COMPANIES BY THE GRACE OF GOD THE ALMIGHTY, THE COMMISSIONERS' COUNCIL OF THE FINANCIAL SERVICES AUTHORITY, Considering:
a. that in order to implement good governance, companies are required to have a compliance function to ensure that business activities are carried out in accordance with legislation in the field of insurance; b. that the compliance function in the insurance sector as regulated in the Financial Services Authority Regulation Number 73/POJK.05/2016 concerning Good Corporate Governance for Insurance Companies is not in line with regulations in the financial services sector, so it needs to be amended;
c. that based on the considerations referred to in letters a and b, it is necessary to establish a Financial Services Authority Regulation concerning Amendment to the Financial Services Authority Regulation Number 73/POJK.05/2016 concerning Good Corporate Governance for Insurance Companies;
Recalling:

1. Law Number 21 of 2011 concerning the Financial Services Authority (State Gazette of the Republic of Indonesia Year 2011 Number 111, Supplement to the State Gazette of the Republic of Indonesia Number 5253);
2. Law Number 40 of 2014 concerning Insurance (State Gazette of the Republic of Indonesia Year 2014 Number 337, Supplement to the State Gazette of the Republic of Indonesia Number 5618);
3. Financial Services Authority Regulation Number 73/POJK.05/2016 concerning Good Corporate Governance for Insurance Companies (State Gazette of the Republic of Indonesia Year 2016 Number 306, Supplement to the State Gazette of the Republic of Indonesia Number 5996);
   DECIDING:
   Establish: FINANCIAL SERVICES AUTHORITY REGULATION CONCERNING AMENDMENT TO THE FINANCIAL SERVICES AUTHORITY REGULATION NUMBER 73/POJK.05/2016 CONCERNING GOOD CORPORATE GOVERNANCE FOR INSURANCE COMPANIES.

Article I
Several provisions in the Financial Services Authority Regulation Number 73/POJK.05/2016 concerning Good Corporate Governance for Insurance Companies (State Gazette of the Republic of Indonesia Year 2016 Number 306, Supplement to the State Gazette of the Republic of Indonesia Number 5996) are amended as follows:

1. The provision of paragraph (1) of Article 7 is amended and Article 7 paragraph (2) is deleted so that Article 7 reads as follows:
   Article 7
   (1) Companies are required to ensure compliance with legislation in the field of Insurance Business and other legislation.
   (2) Deleted.

2. The provision of Article 8 is amended and the explanation of paragraph (2) of Article 8 is amended as stated in the article-by-article explanation in this Financial Services Authority Regulation so that Article 8 reads as follows:
   Article 8
   (1) To ensure compliance as referred to in Article 7 paragraph (1), Companies are required to appoint 1 (one) member of the Board of Directors who oversees the compliance function. (2) The member of the Board of Directors who oversees the compliance function as referred to in paragraph (1) cannot be held concurrently by a member of the Board of Directors who oversees the insurance technical function, financial function, or marketing function. (3) Based on supervisory results, the Financial Services Authority may request Companies to appoint a member of the Board of Directors who only oversees the compliance function.

Article II
This Financial Services Authority Regulation takes effect on the date of its promulgation.

• 4 -
  This copy is consistent with the original
  Director of Law 1
  Legal Department signed
  Yuliana

In order that everyone knows it, order the promulgation of this Financial Services Authority Regulation by placing it in the State Gazette of the Republic of Indonesia. Established in Jakarta on 27 December 2019 CHAIRMAN OF THE COMMISSIONERS' COUNCIL FINANCIAL SERVICES AUTHORITY REPUBLIC OF INDONESIA, signed WIMBOH SANTOSO

Promulgated in Jakarta on 31 December 2019
MINISTER OF LAW AND HUMAN RIGHTS
REPUBLIC OF INDONESIA, signed
YASONNA H. LAOLY
STATE GAZETTE OF THE REPUBLIC OF INDONESIA YEAR 2019 NUMBER 271

EXPLANATION
OF
FINANCIAL SERVICES AUTHORITY REGULATION
NUMBER 43 /POJK.05/2019
CONCERNING
AMENDMENT TO THE FINANCIAL SERVICES AUTHORITY REGULATION NUMBER 73/POJK.05/2016 CONCERNING GOOD CORPORATE GOVERNANCE FOR INSURANCE COMPANIES

I. GENERAL
The Financial Services Authority Regulation Number 73/POJK.05/2016 concerning Good Corporate Governance for Insurance Companies serves as a guideline for Companies in implementing good governance. In implementing good governance, Companies are required to have a compliance function. This aims to ensure that business activities are carried out in accordance with legislation in the field of Insurance Business. In line with this objective, regulations regarding the compliance function in Companies need to be aligned with regulations regarding the compliance function of other financial service institutions, so that the Financial Services Authority Regulation Number 73/POJK.05/2016 concerning Good Corporate Governance for Insurance Companies needs to be perfected. In this regard, the Financial Services Authority establishes this Financial Services Authority Regulation, which is an amendment to the Financial Services Authority Regulation Number 73/POJK.05/2016 concerning Good Corporate Governance for Insurance Companies.

• 2 -
  II. ARTICLE BY ARTICLE EXPLANATION
  Article I
  Number 1
  Article 7
  It is clear enough.
  Number 2
  Article 8
  Paragraph (1)
  It is clear enough.
  Paragraph (2)
  The term "insurance technical function" refers to the actuarial function, product development and monitoring, underwriting, and claims.
  Paragraph (3)
  Bases for supervisory results include, among others, the complexity and business lines of the Company.
  Article II
  It is clear enough.

SUPPLEMENT TO THE STATE GAZETTE OF THE REPUBLIC OF INDONESIA NUMBER 6450