CASE QUESTION Pt. Jiwasraya Insurance is an Indonesian state-owned enterprise involved in the insurance sector. The company was founded in 1878, which makes it the olde
CASE QUESTION
Pt. Jiwasraya Insurance is an Indonesian state-owned enterprise involved in the insurance sector. The company was founded in 1878, which makes it the oldest financial services company (of any kind) in Indonesia. Cases involving Pt. Asuransi Jiwasraya (Persero) can be classified as a large-scale corruption case that causes liquidity pressure so that the company’s equity was recorded as negative IDR 23.92 billion rupees in September 2019. In addition, Jiwasraya needed IDR 32.89 billion to return to health. On January 8, on January 20, the president of the Supreme Audit Board (BPK) finally explained in detail the chronology of this case. In 2006-2008, the Ministry of State Owned Enterprises and the Financial Services Authority (OJK) said that Jiwasraya’s actions had been recorded as negative billions of RP3.29 and that the supreme audit agency (BPK) provided a ‘non-liability opinion (don’t express your opinion) for financial statements.
In May 2012, Jesus refused a request for reinsurance extension. Jiwasraya’s 2011 financial report will not reflect a fair number. In 2012, Bapepam-LK submitted plans for the JS Protection Plan products on December 18, 2012. The JS Protection Plan is marketed in collaboration with banks (Bancassurance). It should be remembered that during 2013-2017, Jiwasraya’s premium income increased due to sales of JS savings products with an annual disbursement period. In 2018, OJK insurance supervision director Ahmad Nasrullah issued a 2016 reserve bonus letter of 10.9 billion IDR. In the same month, Jiwasraya’s president director, Hendrisman Rahim and Jiwasraya’s finance director, Hary Prasetyo, were removed. Customers started cashing in on JS’s savings plan to embrace the former director’s depravity.
Shareholders appointed Asmawi Syam to the post of president of President Jiwasraya, under his direction, the new administrators indicated that there were irregularities in financial reports at the Ministry of Public Companies. The indications for deviation are correct, because the audit results of the accounting firm (KAP) PricewaterhouseCoopers (PWC) on the 2017 financial statements corrected the financial statements while from a profit of 2.4 billion only 428 billion rupees.
August 2018, Minister of Bunm, Rini Semarno, gathered administrators to explore potential company failures. He also asked the BPK and BPKP to conduct an investigative audit on Jiwasraya. The problem of Jiwasraya’s liquidity pressure began to feel the public. The company announced that it was unable to pay client complaints for the JS savings plan in the amount of IDR 802 billion.
In November 2019, the shareholders appointed Hexana Tri Sasongko as Director Director to replace Asmawi Syam. Hexana revealed that Jiwasraya needed IDR 32.89 billion in funds to respond to a solvency ratio of 120% (RBC). Not only that, the company’s assets are only listed at IDR 23.26 billion, while its liabilities stand at 50.5 billion rupees. As a result, Jiwasraya’s negative actions rose to IDR 27.24 billion. Meanwhile, liability for problematic products from the JS savings plan was recorded at IDR 15.75 billion.
An investigation into the Attorney General’s Office of the Jiwasraya corruption case said that there was a violation of the prudential principle in investment. Attorney General St. Burhanunuddin even said that Jiwasraya placed many of the 95 investment funds in risky assets, the Corruption Eradication Commission (KPK) also monitored the development of the Corruption Directorate which was suspected of being behind Jiwasraya’s budget deficit in addition, which then asked the General Directorate to the general public. General) The law of the Ministry of Immigration and Human Rights prohibits 10 names allegedly responsible for the Jiwasraya affair.
In terms of non-payment, the internal impact of the Jiwasraya company is required to restructure due to Jiwasraya’s financial situation which is considered favorable if it is required to continue operating and report client complaints. After the restructuring process is complete, Jiwasraya will be completely replaced by IFG Life. Several Jiwasraya employees were also forced to be fired unilaterally without prior socialization and there were employees who were transferred without suffering from proper procedures.
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