logo czasopisma

Articles

Vol. 55 No. 2 (2025): Law and Social Bonds no. 2 (55) 2025

Strengthening Legal Enforcement in the Indonesian Insurance Sector: Regulatory Gaps and Policy Reform Agenda

DOI:
https://doi.org/10.36128/PRIW.VI55.1244
Submitted
5 March 2025
Published
5 June 2025

Abstract

The purpose of this study is to assess the effectiveness of current insurance regulation in Indonesia and to propose legislative reforms to improve policyholder protection and prevent fraudulent practices within the industry. The research focuses on identifying regulatory weaknesses that allow fraud and mismanagement to persist, using the AJB Bumiputera 1912 case as a primary example. A legal-normative approach was adopted, analysing insurance-related legislation, court decisions and regulatory frameworks in comparison with those of other countries. Secondary data was collected from legal sources, reports from the Financial Services Authority (OJK) and the Financial Transaction Reports and Analysis Centre (PPATK), and existing literature on insurance fraud and regulatory oversight.

References

  1. Abramovsky Aviva, “Reinsurance: The Silent Regulator” Connecticut Insurance Law Journal, No. 2 (2008): 345-406.
  2. Beccaria Cesare, On Crimes and Punishments. New Jersey: Transaction Publishers, 2016.
  3. Bennett Paul, “Governing Environmental Risk: Regulation, Insurance and Moral Economy” Progress in Human Geography, No. 2 (1999): 189-208. Doi:10.1177/030913259902300203.
  4. Clarke Michael, “Insurance Fraud” The British Journal of Criminology, No. 1 (1989): 1-20. doi:10.1093/oxfordjournals.bjc.a047785.
  5. Clarke Michael, “The Control Insurance Fraud” The British Journal of Criminology, No. 1 (1990): 1-23. Doi:10.1093/oxfordjournals.bjc.a047963.
  6. Coffee John C. Jr., “Law and the Market: The Impact of Enforcement” University of Pennsylvania Law Review, 156 (2008/2007): 229.
  7. Defara, “AJB Bumiputera Kembali Digugat Karena Gagal Bayar Klaim Nasabah, Ini Sejarah Panjang Perusahaan Asuransi Itu | Tempo.Co” 2025. https://www.tempo.co/ekonomi/ajb-bumiputera-kembali-digugat-karena-gagal-bayar-klaim-nasabah-ini-sejarah-panjang-perusahaan-asuransi-itu-1168190?utm_source=chatgpt.com.
  8. Handbook of Insurance, ed. Georges Dionne. New York: Springer, 2013. doi:10.1007/978-1-4614-0155-1.
  9. Friedman Lawrence M., The Legal System: A Social Science Perspective. New York: Russell Sage Foundation, 1975.
  10. Garner Bryan A., Black’s Law Dictionary. St. Paul Minn: West Group, 1999.
  11. Gobert James, Maurice Punch, Rethinking Corporate Crime. Cambridge: Cambridge University Press, 2003.
  12. Gustav Radbruch, “Statutory Lawlessness and Supra-Statutory Law (1946)” Oxford Journal of Legal Studies, No. 1 (2006): 1-11. Doi:10.1093/ojls/gqi041.
  13. Irwansyah Irwansyah, “Penelitian Hukum: Pilihan Metode & Praktik Penulisan Artikel” Yogyakarta: Mirra Buana Media, 8 (2020).
  14. Kaswan Kuldeep Singh, Jagjit Singh Dhatterwal, Sanjay Kumar, Sandeep Lal, “Cybersecurity Law-Based Insurance Market,” [in:] Big Data: A Game Changer for Insurance Industry, ed. Kiran Sood, Rajesh Kumar Dhanaraj, Balamurugan Balusamy, Simon Grima, R. Uma Maheshwari. 303–21. Bradford: Emerald Publishing Limited, 2022. doi:10.1108/978-1-80262-605-620221018.
  15. Klein Robert W., “Principles for Insurance Regulation: An Evaluation of Current Practices and Potential Reforms” The Geneva Papers on Risk and Insurance - Issues and Practice, No. 1 (2012): 175-199. Doi:10.1057/gpp.2011.9.
  16. McBarnet Doreen, Christopher Whelan, “The Elusive Spirit of the Law: Formalism and the Struggle for Legal Control” Modern Law Review, 54 (1991): 848-873.
  17. McConville Mike, Research Methods for Law. Edinburgh: Edinburgh University Press, 2017.
  18. Norton Joseph J., “Global Financial Sector Reform: The Single Financial Regulator Model Based on the United Kingdom FSA Experiece - A Critical Reevaluation” International Lawyer (ABA), 39 (2005): 15-62.
  19. OJK, “Siaran Pers: OJK Nyatakan Tidak Keberatan Rencana Penyehatan Keuangan AJB Bumiputera 1912,” 2023. https://ojk.go.id/id/berita-dan-kegiatan/siaran-pers/Pages/OJK-Nyatakan-Tidak-Keberatan-Rencana-Penyehatan-Keuangan-AJB-Bumiputera-1912.aspx.
  20. Picard Pierre, “Economic Analysis of Insurance Fraud,” [in:] Handbook of Insurance, ed. Georges Dionne. 22:315-362. Dordrecht: Springer Netherlands, 2000. doi:10.1007/978-94-010-0642-2_10.
  21. Posner Richard, Theories of Economic Regulation. Cambridge: National Bureau of Economic Research, 1974. doi:10.3386/w0041.
  22. Posner Richard A., Economic Analysis of Law. Waltham: Aspen Publishing, 2014.
  23. Reid Alan S., “Financial Crime in the Twenty-First Century: The Rise of the Virtual Collar Criminal,” [in:] White Collar Crime and Risk, ed. Nic Ryder. 231-251. London: Palgrave Macmillan, 2018. Doi:10.1057/978-1-137-47384-4_9.
  24. Robinson Paul H., Intuitions of Justice and the Utility of Desert. New York: Oxford University Press, 2013.
  25. Schwarcz Daniel, Steven L Schwarcz, “Regulating Systemic Risk in Insurance” The University of Chicago Law Review, (2014): 1569-1640.
  26. Sjostrom Jr William K., “The AIG Bailout” Washington & Lee Law Review, 66 (2009): 943-991.
  27. Stigler George J., “The Theory of Economic Regulation,” [in:] The Political Economy: Readings in the Politics and Economics of American Public Policy. 67-81. London: Routledge, 2021.
  28. Tarr Anthony A, Julie-Anne Tarr, Maurice Thompson, Dino Wilkinson, The Global Insurance Market and Change: Emerging Technologies, Risks and Legal Challenges, 2023.
  29. Watkins Dawn, Research Methods in Law. London: Routledge, 2017.
  30. Windiantina Wiwin Wintarsih, Eman Suparman, Isis Ikhwansyah, Nyulistiowat Suryanti, “Ex Gratia as an Alternative for Settlement of Insurance Claims Outside the Court” Cogent Social Sciences, No. 1 (2022): 2050496. Doi:10.1080/23311886.2022.2050496.
  31. Winter Ralph A., “Moral Hazard and Insurance Contracts,” [in:] Contributions to Insurance Economics, ed. Georges Dionne. 13:61-96. Huebner International Series on Risk, Insurance and Economic Security. Dordrecht: Springer Netherlands, 1992. doi:10.1007/978-94-017-1168-5_3.
  32. Witt John Fabian, The Accidental Republic: Crippled Workingmen, Destitute Widows, and the Remaking of American Law. Boston: Harvard University Press, 2004. doi:10.4159/9780674045279.
  33. Worthington Steve, “Financial Fraud in a Digital Era,” [in:] The Palgrave Encyclopedia of Interest Groups, Lobbying and Public Affairs, ed. Phil Harris, Alberto Bitonti, Craig S. Fleisher, Anne Skorkjær Binderkrantz. 489-492. Cham: Springer International Publishing, 2022. doi:10.1007/978-3-030-44556-0_177.

Downloads

Download data is not yet available.