The Financial Services Authority (OJK) has organised a meeting between executives of financially-stricken Asuransi Jiwasraya and with several representatives of Jiwasraya policyholders who oppose a restructuring scheme for the financially-stricken life insurer and the transfer of policies from Jiwasraya to Asuransi Jiwa IFG (IFG Life).
At the meeting, held on 20 August, the representatives of the objectors insisted that the insurer make repayments to them as had been ordered by a court, according to local media reports.
70 policyholders (0.3% of the total number of Jiwasraya policyholders) rejected the restructuring of the insurer. This group of policyholders has a combined claim value of around IDR200bn ($13m).
Mr Rizal Ramadhani, OJK deputy commissioner for Supervision of Financial Services Business Actors' Behaviour and Consumer Protection, who led the meeting, noted that Jiwasraya's assets had a total value of around IDR6.7tn. This sum is not sufficient to repay all 350,000 policyholders whose combined claims total IDR38tn.
Mr Rizal added that the OJK's statement of no objection to the Financial Recovery Plan (RPK) submitted by Jiwasraya was because the plan was within the framework of consumer protection. He said that OJK had considered the interests of all policyholders,
He said, "The OJK supports the restructuring process called the financial recovery plan. The goal is not only to make Jiwasraya healthy but also ultimately to protect all policyholders who number 350,000."
OJK stated that it respects the legal process. "For this reason, OJK appeals to the parties involved, including Jiwasraya, to respect the ongoing legal process and follow up on it."
However, Mr Riza added, other matters must be considered as well such as the value of the remaining assets owned by Jiwasraya and the number of policyholders who participate in the restructuring programme and have transferred their policies to Jiwa IFG.
Jiwasraya said that if it could not carry out the court order and pay off the 70 objecting policyholders. To do so would attract protests from those who participate in the restructuring exercise.