The reluctance to continue the agreement

Oct 13, 2025 by talynt.org 59 views

Legal Protection for Policy Holders Who Do Not Pay Premium: Case Study of AJB Bumiputera 1912 and PT. Family Takaful Insurance in Medan

In the rapidly developing insurance industry in Indonesia, the emergence of sharia insurance companies such as PT. Takaful family insurance is a testament to the community's growing need for life protection in accordance with Islamic principles. The sharia insurance system serves as an alternative for those who are skeptical about conventional systems that contain elements of usury, gharar, and maisir. As the insurance industry continues to grow, it is essential to examine the legal protection of policy holders who do not meet their obligations in payment of premiums.

Understanding Life Insurance and Premium Payment Obligations

Life insurance is a contractual agreement between the policyholder (insured) and the insurance company (insurer), which outlines the rights and obligations of both parties. The primary obligation of the insurance company is to provide compensation for the risk experienced by the insured, while the main obligation of the policyholder is to pay the premium. This is in accordance with Law Number 2 of 1992 concerning Insurance Business, which states that insurance is an agreement in which the guarantor binds himself to give a replacement to the insured for the loss he suffered due to uncertain events.

However, in practice, there are still many policyholders who do not meet the obligations of premium payment. This study focuses on cases in AJB Bumiputera 1912 and PT. Takaful family insurance in Medan, analyzes the reasons behind the non-compliance and the legal consequences, as well as the settlement efforts taken.

Reasons Behind Non-Compliance and Legal Consequences

Based on descriptive-analytical and comparative research with an empirical juridical approach, it was found that the main reasons for the policyholder not paying the premiums were:

Reduced financial ability: Economic factors are the main determinant in the ability to pay premiums. Worsened financial conditions can force policyholders to delay or stop payment of premiums.
Agents/insurance officers: Sometimes, insurance agents are inconsistent in collecting premiums, so that policyholders forget or ignore their obligations.
The reluctance to continue the agreement: There are also policyholders who choose not to continue the life insurance agreement for personal reasons or feel no longer need it.

The legal consequences for policyholders who are in arrears are different between AJB Bumiputera 1912 and PT. Family Takaful Insurance:

AJB Bumiputera 1912:

Flower imposition: The company has the right to wear interest on premiums that have not been paid.
Cancellation of claims: Policy holders lose their rights to compensation claims, even premium money that has been paid will not be returned.

PT. Takaful Family Insurance:

Cancellation of Policy: Policy is declared canceled if the advanced premium is not paid after passing the grace period of one month.
Premium return (for policy with savings): Policyholders who want to cancel the policy can request a premium return that has been paid, with the condition that the policy contains the element of savings.
Payment of compensation (for policy with a savings element): If the policyholder dies in a state of the policy canceled, the heirs are still entitled to get compensation in the form of cash value listed in the policy.
There is no imposition of fines: PT. Takaful family insurance does not wear a fine for premium arrears.

Efforts to Overcome Premium Arrears

To overcome this problem, both AJB Bumiputera 1912 and PT. Takaful family insurance have almost the same effort, namely:

Oral and written reprimands: The company gives a warning to the policyholder who is in arrears.
Policy Cancellation: Policyholders can submit policy cancellation in writing by meeting the requirements specified by the company.

Solutions and Recommendations

So that the case of premium arrears does not continue to repeat, the following recommendations need to be considered:

Policy holder:

Pay premiums on time according to the agreement.
Choosing insurance products that fit the needs and financial capabilities.

Insurance company:

Conduct training and education for operational officers to market insurance products professionally and in accordance with customer needs.
Conduct premium billing on an ongoing manner to the address of the policy holder in accordance with the agreement.
Provide a clear and transparent explanation of the benefits, rights, and obligations in life insurance agreements.

The Importance of Dispute and Regulation Settlement Institutions

The formation of an insurance contract dispute resolution institution is needed to facilitate the problem-solving process between the insurance company and the policyholder. The government also needs to issue special laws and regulations governing the contents of insurance contracts to be more standardized and protect the rights of both parties.

By increasing the awareness of policyholders, the professionalism of insurance companies, and the existence of clear regulations, it is hoped that the case of premium arrears can be reduced and legal protection for policyholders is increasingly guaranteed.

Conclusion

In conclusion, the study highlights the importance of understanding the legal protection of policy holders who do not meet their obligations in payment of premiums. The findings of this study provide valuable insights into the reasons behind non-compliance and the legal consequences, as well as the settlement efforts taken by AJB Bumiputera 1912 and PT. Takaful family insurance. The recommendations provided in this study aim to reduce the case of premium arrears and increase the legal protection for policyholders.
Frequently Asked Questions (FAQs) on Legal Protection of Policy Holders Who Do Not Pay Premium

In our previous article, we discussed the importance of understanding the legal protection of policy holders who do not meet their obligations in payment of premiums. In this article, we will answer some frequently asked questions (FAQs) related to this topic.

Q: What are the main reasons why policyholders do not pay their premiums?

A: The main reasons why policyholders do not pay their premiums are:

Reduced financial ability: Economic factors are the main determinant in the ability to pay premiums. Worsened financial conditions can force policyholders to delay or stop payment of premiums.
Agents/insurance officers: Sometimes, insurance agents are inconsistent in collecting premiums, so that policyholders forget or ignore their obligations.
The reluctance to continue the agreement: There are also policyholders who choose not to continue the life insurance agreement for personal reasons or feel no longer need it.

Q: What are the legal consequences for policyholders who are in arrears?

A: The legal consequences for policyholders who are in arrears are different between AJB Bumiputera 1912 and PT. Family Takaful Insurance. For AJB Bumiputera 1912, the company has the right to wear interest on premiums that have not been paid, and policy holders lose their rights to compensation claims. For PT. Takaful Family Insurance, policy is declared canceled if the advanced premium is not paid after passing the grace period of one month, but policyholders who want to cancel the policy can request a premium return that has been paid.

Q: What are the efforts taken by insurance companies to overcome premium arrears?

A: The efforts taken by insurance companies to overcome premium arrears are:

Oral and written reprimands: The company gives a warning to the policyholder who is in arrears.
Policy Cancellation: Policyholders can submit policy cancellation in writing by meeting the requirements specified by the company.

Q: What are the solutions and recommendations to reduce the case of premium arrears?

A: The solutions and recommendations to reduce the case of premium arrears are:

Policy holder:

Pay premiums on time according to the agreement.
Choosing insurance products that fit the needs and financial capabilities.

Insurance company:

Conduct training and education for operational officers to market insurance products professionally and in accordance with customer needs.
Conduct premium billing on an ongoing manner to the address of the policy holder in accordance with the agreement.
Provide a clear and transparent explanation of the benefits, rights, and obligations in life insurance agreements.

Q: Why is the formation of an insurance contract dispute resolution institution important?

A: The formation of an insurance contract dispute resolution institution is important because it facilitates the problem-solving process between the insurance company and the policyholder. This institution can help to resolve disputes and provide a fair and transparent process for both parties.

Q: What role does the government play in regulating the insurance industry?

A: The government plays a crucial role in regulating the insurance industry by issuing special laws and regulations governing the contents of insurance contracts. This helps to ensure that insurance companies operate fairly and transparently, and that policyholders are protected.

Q: How can policyholders protect themselves from premium arrears?

A: Policyholders can protect themselves from premium arrears by:

Paying premiums on time according to the agreement.
Choosing insurance products that fit their needs and financial capabilities.
Reading and understanding the terms and conditions of their insurance policy.
Contacting their insurance company if they have any questions or concerns.

By understanding the legal protection of policy holders who do not meet their obligations in payment of premiums, policyholders can take steps to protect themselves and avoid premium arrears.