Opening Door for Foreign Investment in Insurance Market

By Editorial Team 06/10/2020
Insurance
Summary

Finance Minister Sri Mulyani Indrawati asked consent from Commission XI overseeing financial affairs at the House of Representatives to expand market access for sharia insurance industry to ASEAN, in a hearing on Monday. This regarding to seventh protocol of ASEAN Framework Agreement on Service (AFAS) in the financial service sector. 

Sri Mulyani said AFAS regulation is really important for ASEAN countries’ economy. Contribution of the service sector accounted for 52 percent of the total Gross National Product of ASEAN in 2019.

There are four reasons why the government wants to ratify the protocol. First, the regulation will increase capital accumulation to develop sharia general insurance industry. Second, to encourage the transfer of technology to improve human resource and product innovation. Third, expanding efforts on household protection, government, and business players carried out by insurance companies. Fourth, increasing contribution of the insurance industry toward income from the financial market.

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