Indonesia to consider mandatory TPL insurance

This move is driven by the increasing number of accidents on the road.

Indonesia’s General Insurance Association (AUI) pushes for the third party liability (TPL) insurance to be enacted by 2025, reported by news agency Voice of Indonesia (VOI).

Wayan Pariama, Deputy Chairperson of Technical Affairs 3 of AUI emphasised the need for the regulation to be included in the list of planned regulations by October this year.

Speaking in Jakarta, Wayan noted that his team is gathering necessary data, including premium calculations, to expedite the process.

Currently, TPL insurance is offered voluntarily by many insurers in Indonesia as part of all-risk vehicle insurance products.

The proposed regulation would make TPL insurance mandatory for all vehicle owners, covering medical expenses for injured victims, compensation for heirs of the deceased, and compensation for material losses due to accidents.

This move is driven by the high number of accidents, with 103,645 incidents in 2021, resulting in 25,266 deaths and state budget losses of IDR526.1t.

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Jasa Raharja data indicates that 62.5% of families of deceased accident victims and 13% of families of seriously injured victims fell into poverty post-accident.

Wayan stated that the insurance premium would be paid when vehicle owners register or renew their STNK.

The proposed regulation will also mandate insurance for participants at crowded events, with the premium included in ticket costs.

Wayan emphasized that the new regulations would make both vehicle accident TPL insurance and event insurance mandatory.