DIGIVESTASI - Cars and motorcycles could be required to have insurance by 2025. Indeed, the Indonesian General Insurance Association (AAUI) is currently pushing for the issuance of a clause requiring Third Party Liability (TPL) for all motor vehicles.

TPL itself is public liability insurance, a type of protection that covers risks related to third-party claims. This proposal is due to the high number of accident victims in 2023, which is likely to reach 148,000 cases. 

Wayan Pariama, AAUI Vice President for Engineering 3, said his party is currently exploring the possibility of establishing two to three companies that will provide mandatory TPL insurance to meet these needs. According to him, the establishment of corporations will facilitate the implementation of compulsory insurance in Indonesia and avoid complications. 
“What if it's mandatory?” said Wayan in an AAUI press conference some time ago, quoted on Thursday (May 23, 2024). 

“There may be those who consider it an additional cost. But this is borne by those who can afford to buy a car. Can't afford insurance of Rp 300,000?” he added. For example, the current car insurance rate is estimated to be around 1% of the insured value with an insured value of up to 100 million. And this rate will become cheaper if a higher insurance value is chosen. 

Wayan further explained that this mandatory TPL insurance will then be applied to every car on the road, not just new cars. In other words, even used cars on the road must have insurance. 

Related to this, the Financial Services Authority (OJK) is still waiting for the draft government regulation (RPP) on mandatory insurance regulations. Ogi Prastomiyono, General Manager of Insurance, Guarantee, and Pension Fund Supervision (PPDP) at OJK, said the PP is a derivative of the P2SK Law. 

The order is the P2SK Law, then the government regulation on new compulsory insurance, POJK. If the RPP Law is less than 2 years, it means May 12, 2025,” Ogi explained at the Indonesia Stock Exchange (IDX) building. 

Based on AAUI data, in 2023 car claim payments reached Rp 7 trillion. Therefore, TPL insurance or public liability insurance is needed, which is a type of insurance that guarantees the risk of third-party claims. 

Currently, almost all car insurance policies that offer comprehensive protection already offer TPL protection.

But for total loss insurance alone, most do not include TPL. Furthermore, most motorcycles are not covered by TPL insurance.

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