Letter of the Financial Services Authority Number 18/SEOJK.05/2014 on the Report on the Implementation of Good Corporate Governance for Insurance Brokerage Companies, Reinsurance Brokerage Companies, and Insurance Loss Assessors

To:

1. Insurance Brokerage Companies;
2. Reinsurance Brokerage Companies; and
3. Insurance Loss Assessors

At your place.

COPY

LETTER OF THE FINANCIAL SERVICES AUTHORITY
NUMBER 18/SEOJK.05/2014

ON

THE REPORT ON THE IMPLEMENTATION OF GOOD CORPORATE GOVERNANCE FOR INSURANCE BROKERAGE COMPANIES, REINSURANCE BROKERAGE COMPANIES, AND INSURANCE LOSS ASSESSORS

In view of the mandate of Article 79 paragraph (3) of the Financial Services Authority Regulation Number 2/POJK.05/2014 concerning Good Corporate Governance for Insurance Companies, it is necessary to regulate the form and structure of the report on the implementation of good corporate governance for insurance brokerage companies, reinsurance brokerage companies, and insurance loss assessors in this Letter of the Financial Services Authority as follows:

I. GENERAL PROVISIONS

1. Company means insurance brokerage companies, reinsurance brokerage companies, and insurance loss assessors.

2. General Meeting of Shareholders, hereinafter abbreviated as GMS, is the general meeting of shareholders as referred to in the laws concerning limited liability companies for Companies that are legal entities in the form of limited liability companies or equivalent to GMS for Companies that are legal entities in the form of cooperatives or joint ventures.

3. Board of Directors is the organ of the Company that performs the management functions as referred to in the laws concerning limited liability companies for Companies that are legal entities in the form of limited liability companies or equivalent to the Board of Directors for Companies that are legal entities in the form of cooperatives or joint ventures.

4. Board of Commissioners is the organ of the Company that performs supervisory and advisory functions as referred to in the laws concerning limited liability companies for Companies that are legal entities in the form of limited liability companies or equivalent to the Board of Commissioners for Companies that are legal entities in the form of cooperatives or joint ventures.

5. Good Corporate Governance for the Company, hereinafter referred to as Good Corporate Governance, is the structure and process used and applied by the Company's organs to improve the achievement of business results objectives and optimize company value for all stakeholders, particularly policyholders, insured parties, participants, and/or parties entitled to benefits, in an accountable manner and based on laws and regulations as well as ethical values.

6. Financial Services Authority is an independent agency free from the interference of other parties, which has the functions, duties, and authorities for regulation, supervision, examination, and investigation as referred to in Law Number 21 of 2011 concerning the Financial Services Authority.

7. Executive Head of Supervision for Insurance, Pension Funds, Financing Institutions, and Other Financial Service Institutions, hereinafter referred to as Executive Head of Non-Bank Financial Industry Supervision, is a member of the Financial Services Authority Commissioners who is tasked with leading the implementation of supervision of non-bank financial service institution activities.

II. REPORT ON THE IMPLEMENTATION OF GOOD CORPORATE GOVERNANCE

1. Companies are required to prepare a report on the implementation of Good Corporate Governance at the end of each fiscal year.

2. The report on the implementation of Good Corporate Governance as referred to in item 1 consists of at least:
   a. transparency of the implementation of Good Corporate Governance; b. self-assessment of the implementation of Good Corporate Governance; and
   c. action plan.

III. TRANSPARENCY OF THE IMPLEMENTATION OF GOOD CORPORATE GOVERNANCE

1. Transparency of the implementation of Good Corporate Governance as referred to in Roman numeral II item 2 letter a includes at least the disclosure of all aspects of the implementation of Good Corporate Governance principles.

2. The aspects of the implementation of Good Corporate Governance principles as referred to in item 1 are as follows:
   a. Disclosure of the implementation of Good Corporate Governance includes at least:

1. Implementation of duties and responsibilities of the Board of Directors and Board of Commissioners, consisting of:
   a) number, job titles, criteria, date of appointment by GMS, term of office, nationality, and domicile of members of the Board of Directors and Board of Commissioners; b) duties and responsibilities of the Board of Directors and Board of Commissioners; c) concurrent positions held by members of the Board of Directors and Board of Commissioners; d) training for members of the Board of Directors and Board of Commissioners; e) implementation of activities and recommendations of the Board of Commissioners; and f) frequency of Board of Directors meetings and Board of Commissioners meetings held, at least covering:
   (1) number of meetings held in 1 (one) year;
   (2) number of meetings attended physically and/or via teleconference, video conference, or other electronic media facilities; and (3) attendance of each member at each meeting. Companies that do not yet have at least 2 (two) members of the Board of Directors and 2 (two) members of the Board of Commissioners may disclose the frequency of Board of Commissioners meetings with the Board of Directors only.
2. Implementation of external auditor functions.
   Information to be disclosed is the performance of the external auditor's duties, including the effectiveness of the external auditor's duties and the company's compliance with regulations, including the provision of all accounting records and data necessary for external auditors so that external auditors can provide their opinion on the fairness, compliance, and conformity of the company's financial reports with applicable audit standards. This regulation applies only to insurance brokerage companies and reinsurance brokerage companies.
3. Implementation of risk management, including internal control systems.
   Information to be disclosed includes:
   a) active supervision by the Board of Commissioners and Board of Directors; b) adequacy of policies, procedures, and risk limit determinations; c) adequacy of risk identification, measurement, monitoring, and control processes; d) risk management information systems; and e) comprehensive internal control systems.
4. Implementation of remuneration policies and other facilities for members of the Board of Directors and Board of Commissioners in 1 (one) year, at least including:
   a) remuneration in non-natura form, including salaries and other fixed income, including allowances (benefits), stock-based compensation, bonuses, and other forms of remuneration; and b) other facilities in natura or non-natura form, i.e., other variable income, including allowances for housing, transportation, health insurance, and other facilities.
5. Transparency of the Company's financial and non-financial conditions not disclosed in other reports.
6. Company functions outsourced to third parties.
7. Implementation of GMS authority, consisting of:
   a) implementation of annual GMS and extraordinary GMS and decisions resulting from each GMS; b) GMS announcement and summons processes; and c) other matters awaiting GMS approval. b. Disclosure of share ownership by members of the Board of Directors and Board of Commissioners reaching 5% (five percent) or more of paid-up capital, including the type and number of share certificates in:
8. The Company itself;
9. other insurance companies;
10. financial service companies other than insurance companies; and
11. other companies located domestically or abroad, including shares obtained through the stock exchange.
    c. Financial relationships and family relationships of Board of Directors members with other Board of Directors members, Board of Commissioners members, and/or shareholders of the Company where the respective Board of Directors member serves.
    d. Financial relationships and family relationships of Board of Commissioners members with other Board of Commissioners members, Board of Directors members, and/or shareholders of the Company where the respective Board of Commissioners member serves. e. Number of internal deviations (internal fraud).
12. Internal deviation refers to deviations committed by members of the Board of Directors, members of the Board of Commissioners, permanent employees, and non-permanent employees (including honoraries and contract workers) that can harm and endanger the continuity of business or the financial health of the Company.
13. Disclosure regarding internal deviations includes at least:
    a) number of internal deviations resolved; b) number of internal deviations currently being resolved internally; c) number of internal deviations not yet pursued for resolution; and d) number of internal deviations followed up through legal processes. f. Disclosure of other important matters, at least including:
14. resignation or dismissal of external auditors;
15. material transactions with related parties:
    Material transactions with related parties are any:
    a) purchase, sale, or exchange of shares or assets with a value of 10% (ten percent) or more of the Company's equity conducted with related parties in a single transaction or a series of transactions; b) property leasing, management agreements, and services, including cooperation for resource sharing (sharing of resources) conducted with related parties; c) settlement of intercompany balances conducted with related parties;
16. conflicts of interest currently ongoing and/or likely to occur;
17. other material information regarding the Company related to Good Corporate Governance, including owner intervention, internal disputes, or issues arising as a result of remuneration policies on the Company.
    g. Legal issues;
18. Legal issues refer to civil and criminal legal problems faced by the Company during the reporting period and where legal processes have proceeded;
19. Disclosure regarding legal issues includes at least:
    a) number of legal issues that have received final and binding judgments; and b) number of legal issues still in the process of resolution in courts and alternative dispute resolution institutions for civil cases.

IV. SELF-ASSESSMENT ON THE IMPLEMENTATION OF GOOD CORPORATE GOVERNANCE

1. Companies are required to conduct self-assessments on the implementation of Good Corporate Governance periodically at least 1 (one) time in 1 (one) year.

2. Self-assessment on the implementation of Good Corporate Governance as referred to in item 1 is conducted based on the Good Corporate Governance guidelines and self-assessment checklists prepared by a committee formed by the government tasked with formulating Good Corporate Governance policies.

3. The report on the results of self-assessment on the implementation of Good Corporate Governance is an inseparable part of the Report on the Implementation of Good Corporate Governance as referred to in Roman numeral II item 2.

V. ACTION PLAN

1. Companies are required to prepare an action plan to improve or perfect the implementation of Good Corporate Governance as a follow-up to the results of self-assessment. The mentioned action plan includes necessary corrective actions, completion timeframes, and obstacles or hindrances to completion, if there are still deficiencies in the implementation of Good Corporate Governance.

2. The action plan as referred to in item 1 is an inseparable part of the Report on the Implementation of Good Corporate Governance.

VI. FORM AND STRUCTURE OF THE REPORT ON THE IMPLEMENTATION OF GOOD CORPORATE GOVERNANCE

The form and structure of the report on the implementation of Good Corporate Governance are as contained in the Appendix which is an inseparable part of this Letter of the Financial Services Authority.

VII. TIME FOR SUBMISSION OF THE REPORT ON THE IMPLEMENTATION OF GOOD CORPORATE GOVERNANCE

1. Companies are required to submit the report on the implementation of Good Corporate Governance for the current year to the Financial Services Authority no later than February 28 of the following year.

2. In the event that February 28 is a holiday, the deadline for submission is the first working day after the mentioned February 28.

VIII. SUBMISSION PROCEDURE

1. Companies are required to submit the report on the implementation of Good Corporate Governance, signed by the Board of Directors and Board of Commissioners, to the Executive Head of Non-Bank Financial Industry Supervision in printed computer output (hardcopy) and electronic (softcopy) forms.

2. The submission address for Companies is:
   Executive Head of Non-Bank Financial Industry Supervision Financial Services Authority u.p. Director of Supporting Services for Non-Bank Financial Industry Sumitro Djojohadikusumo Building, 14th Floor Jl. Lapangan Banteng Timur Number 2-4 Jakarta 10710.

3. In the event of a change in the address of the Financial Services Authority office for report submission as referred to in item 2, the Financial Services Authority will convey notification regarding the address change via letter or announcement.

IX. TRANSITIONAL PROVISIONS

Self-assessment on the implementation of Good Corporate Governance for insurance loss assessors as referred to in Roman numeral IV item 2 takes effect since the establishment of the Good Corporate Governance guidelines and self-assessment checklists prepared by a committee formed by the government tasked with formulating good corporate governance policies.

X. CLOSING

Provisions in this Letter of the Financial Services Authority take effect from the date of establishment.

To ensure that everyone knows, order the announcement of this Letter of the Financial Services Authority by placing it in the State Gazette of the Republic of Indonesia.

Established in Jakarta on December 9, 2014

EXECUTIVE HEAD OF SUPERVISION FOR
INSURANCE, PENSION FUNDS,
FINANCING INSTITUTIONS, AND
OTHER FINANCIAL SERVICE INSTITUTIONS
FINANCIAL SERVICES AUTHORITY,
Signed,
FIRDAUS DJAELANI

STATE GAZETTE OF THE REPUBLIC OF INDONESIA YEAR 2015 NUMBER 3 DATED JANUARY 9, 2015

Copy matches the original
Legal Director 1
Legal Department,
Signed,
Sudarmaji

APPENDIX
LETTER OF THE FINANCIAL SERVICES AUTHORITY
NUMBER 18/SEOJK.05/2014
ON
THE REPORT ON THE IMPLEMENTATION OF GOOD CORPORATE GOVERNANCE FOR INSURANCE BROKERAGE COMPANIES, REINSURANCE BROKERAGE COMPANIES, AND INSURANCE LOSS ASSESSORS

TABLE OF CONTENTS
I. INTRODUCTION
II. TRANSPARENCY OF THE IMPLEMENTATION OF GOOD CORPORATE GOVERNANCE
A. Disclosure of the implementation of Good Corporate Governance.

1. Implementation of duties and responsibilities of the Board of Directors and Board of Commissioners.
   a) number, job titles, criteria, date of appointment by GMS, term of office, nationality, and domicile of members of the Board of Directors and Board of Commissioners (1) Board of Directors No Name Job Title Criteria Date of Appointment by GMS Term of Office Nationality Last Formal Education and Professional Title Work Experience in the Insurance Field Competency and Fit Test 1. 2. Etc. Describe the table above.

In the event that there are changes in the composition of the Board of Directors members during the reporting year, the previous composition of Board of Directors members must be included in a table as follows:
No Name Job Title Date of Appointment by GMS Date of Dismissal by GMS (2) Board of Commissioners No Name Job Title Criteria Date of Appointment by GMS Term of Office Nationality Last Formal Education and Professional Title Work Experience in the Insurance Field Competency and Fit Test 1. 2. Etc. Describe the table above.

In the event that there are changes in the composition of the Board of Commissioners members during the reporting year, the previous composition of Board of Commissioners members must be included in a table as follows:
No Name Job Title Date of Appointment by GMS Date of Dismissal by GMS b) duties and responsibilities of the Board of Directors and Board of Commissioners. c) concurrent positions held by members of the Board of Directors and Board of Commissioners. (1) Board of Directors No Name Position in Company Position in Other Company Name of Other Company Business Field

1. 1.

Etc.
2 1.
2.
Etc.
Etc.
(2) Board of Commissioners
No Name Position in Company Position in Other Company Name of Other Company Business Field

1. 1.

Etc.
2 1.
2.
Etc.
Etc. d) training for members of the Board of Directors and Board of Commissioners. training related to improving the company's human resource capabilities in achieving the company's vision and mission. (1) Board of Directors No Name Job Title Workshop/training/seminar Organizer Date Place 1. 2. Etc. (2) Board of Commissioners No Name Job Title Workshop/training/seminar Organizer Date Place 1. 2. Etc. e) implementation of activities and recommendations of the Board of Commissioners.

f) frequency of Board of Directors meetings and Board of Commissioners meetings held in 1 (one) year.
(1) Board of Directors Meetings.
No Name Job Title Number of Board of Directors Meetings (....times meetings) Number of Attendees % Attendance Physical Teleconference / Video conference/ Other Electronic Media Facilities 1. 2. Etc. (2) Board of Commissioners Meetings. No Name Job Title Number of Board of Commissioners Meetings (....times meetings) Number of Attendees % Attendance Physical Teleconference / Video conference/ Other Electronic Media Facilities 1. 2. Etc. (3) Board of Commissioners Meetings with Board of Directors. No Name Job Title Number of Board of Commissioners Meetings with Board of Directors (....times meetings) Number of Attendees % Attendance Physical Teleconference / Video conference/ Other Electronic Media Facilities 1. 2. Etc. (4) Board of Commissioners Meetings with External Auditors. No Name Job Title Number of Board of Commissioners Meetings with External Auditors (....times meetings) Number of Attendees % Attendance Physical Teleconference / Video conference/ Other Electronic Media Facilities 1. 2. Etc.

2. Implementation of external auditor functions.
   External auditor functions:
   Effectiveness of the implementation of external auditor duties and the company's compliance with regulations, including the provision of all accounting records and data necessary for external auditors so that external auditors can provide their opinion on the fairness, compliance, and conformity of the company's financial reports with applicable audit standards. Examples of regulations related to minimum own capital fulfillment obligations, the amount of unpaid premiums must not exceed own capital, and the implementation of the know-your-customer principle for insurance brokerage companies. Public Accounting Firms that audited the Company's Financial Reports during the last 6 years:
   Year Public Accounting Firm Accountant Name (Individual) This regulation applies only to insurance brokerage companies and reinsurance brokerage companies.

3. Implementation of risk management, including internal control systems.
   a) active supervision by the Board of Commissioners and Board of Directors. examples: reviewing the adequacy and accuracy of underwriting policies and human resources. b) adequacy of policies, procedures, and risk limit determinations. c) adequacy of risk identification, measurement, monitoring, and control processes. d) risk management information systems. e) comprehensive internal control systems.

4. Implementation of remuneration policies and other facilities for members of the Board of Directors and Board of Commissioners in 1 (one) year.
   Type of Remuneration and Other Facilities Amount Received in 1 Year Board of Directors (Millions Rp) Board of Commissioners (Millions Rp)

1. Remuneration (including salaries and other fixed income, including allowances (benefits), stock-based compensation, bonuses, and other forms of remuneration in non-natura form)
2. Other facilities in natura form (housing, transportation, health insurance, etc.
   Total

5. Transparency of the Company's financial and non-financial conditions not disclosed in other reports.
   examples: disclosure of company rating results conducted by rating agencies, transparency regarding products presented in brochures, leaflets, and other promotional media and on the company website, transparency regarding complaint procedures and dispute resolution for policyholders, and share buybacks.

6. Company functions outsourced to third parties (outsourcing)
   No Functions Outsourced to Third Parties Third Party Partner Third Party's Business License Contract Duration Reason for Selecting Third Party

7. Implementation of GMS authority.
   a) implementation of annual GMS and extraordinary GMS and decisions resulting from each GMS. b) GMS announcement and summons processes.

c) other matters awaiting GMS approval. examples: transactions and appointments of the Board of Directors and Board of Commissioners.

B. Disclosure of share ownership by members of the Board of Directors and Board of Commissioners reaching 5% (five percent) or more of paid-up capital, including the type and number of share certificates. Name Job Title Share Ownership by Board of Directors and Board of Commissioners Members Reaching 5% (five percent) or More of Paid-up Capital A B C D Notes:
Indonesia/Abroad
Number
Nominal Shares
Ownership Percentage
Number
Nominal Shares
Ownership Percentage
Number
Nominal Shares
Ownership Percentage
Number
Nominal Shares
Ownership Percentage
Notes:
A. The Company itself;
B. other insurance companies;
C. financial service companies other than insurance companies; and
D. other companies located domestically or abroad, including shares obtained through the stock exchange.

C. Financial relationships and family relationships of Board of Directors members with other Board of Directors members, Board of Commissioners members, and/or shareholders of the Company where the respective Board of Directors member serves.
Notes:
) Form of financial relationship: loans, business cooperation, etc.
) Form of family relationship: spouse/children/parents/siblings/in-laws, etc.
Name Financial Relationship with Other Directors Board of Commissioners Shareholders Yes No Notes Yes No Notes* Yes No Notes* 1.
2.
Etc.
Name Family Relationship with Other Directors Board of Commissioners Shareholders Yes No Notes Yes No Notes Yes No Notes 1.
2.
Etc.

D. Financial relationships and family relationships of Board of Commissioners members with other Board of Commissioners members, Board of Directors members, and/or shareholders of the Company where the respective Board of Commissioners member serves. Notes:
) Form of financial relationship: loans, business cooperation, etc.
) Form of family relationship: spouse/children/parents/siblings/in-laws, etc.
Name Financial Relationship with Other Board of Commissioners Directors Shareholders Yes No Notes Yes No Notes* Yes No Notes* 1.
2.
Etc.
Name Family Relationship with Other Board of Commissioners Directors Shareholders Yes No Notes Yes No Notes Yes No Notes 1.
2.
Etc.

E. Number of internal deviations (internal fraud).
Internal Deviations in 1 Year Number of Cases Committed by Board of Commissioners Members and Board of Directors Members Permanent Employees Non-permanent Employees T-1 T T-1 T T-1 T Total deviations Resolved In the process of resolution internally Resolution not yet pursued Followed up through legal processes.

F. Disclosure of other important matters.

1. resignation or dismissal of external auditors.

2. material transactions with related parties.

3. conflicts of interest currently ongoing and/or likely to occur.
   Examples of conflicts of interest currently ongoing and/or likely to occur include the purchase of Company assets by Board of Directors members, Board of Commissioners members, and/or company employees. No Name and Job Title Party with Conflict of Interest Name and Job Title Decision Maker Type of Transaction Transaction Value (Millions Rupiah) Notes *) 1. 2. Etc. Notes:
   *) Does not comply with applicable systems and procedures

4. other material information regarding the Company related to Good Corporate Governance, including but not limited to owner intervention, internal disputes, or issues arising as a result of remuneration policies within the Company.

G. Legal Issues.

Legal Issues
Number of Cases
Civil Criminal

Has received a final and binding judgment:
a. Civil b. Criminal

In the process of settlement in court and in Alternative Dispute Resolution Institutions for civil cases:
a. Civil b. Criminal

Total

III. ACTION PLAN.

No. Corrective Action Resolution Target Obstacles Resolution Notes 1.
2. etc.

Approved,
Board of Directors Board of Commissioners

Established in Jakarta on December 9, 2014

HEAD OF THE EXECUTIVE SUPERVISOR OF THE INSURANCE, PENSION FUND, FINANCING, AND OTHER FINANCIAL SERVICES INDUSTRY FINANCIAL SERVICES AUTHORITY, Signed, FIRDAUS DJAELANI

A copy consistent with the original
Legal Director 1
Legal Department,
Signed. Signed.
Sudarmaji