A new regulation issued by the Financial Services Authority (OJK) of Indonesia will regulate the development of human resource quality for insurance companies, insurance brokers and reinsurers.
According to the new regulation OJK Regulation Number 34 of 2024 (POJK 34/2024) each company is obliged to provide funds for the development of the quality of human resources as stated in Article 4 of the regulation.
As per the new regulation each company is required to allocate a minimum of 3.5% of its total employee expenses for training, education and workforce certification programmes.
The regulation states that "To support the implementation of education and training of human resources, insurance companies, guarantee institutions and pension funds are required to provide education and training funds from the current year's budget."
POJK 34/2024 aims to adapt the insurance workforce to digitalisation of services, use of big data and implementation of AI. With this regulation, OJK expects that insurance companies, insurance brokers and reinsurers can have a standardised and competent workforce so that they are able to provide the best service for customers and increase public trust in the insurance industry.
OJK department of financial inclusion and communications head Ismail Riyadi said it is necessary that the human resource personnel have the right and specific capacity and competency as required for the specific business. This will enable them to play a significant role in supporting business sustainability amidst competition in the financial services sector.
Mr Riyadi said one of the efforts that can be made by the insurance, guarantee, and pension fund industries in supporting the development of the quality of human resources is through the provision of funds that are realised for improving work competencies or developing other competencies in technical and non-technical fields.