TEMPO.CO, Jakarta - The Minister of State-owned Enterprises Dahlan Iskan announced that on January 1, 2015, Indonesia officially will have a state-owned reassurance company by combining four reassurance companies.

They are Reasuransi Internasional Indonesia (ReIndo), Tugu Reasuransi Indonesia, Reasuransi Nasional Indonesia (NasRe), and Asuransi Ekspor Indonesia (ASEI), he stated.

"The state-owned reassurance company, Indonesian Reassurance, will be launched in October 2014 and will officially begin operating from January 1, 2015," Dahlan said as quoted by Antara News.

According to Dahlan, preparations for the merger of three reassurance companies and one assurance company have entered the final stages at the Financial Services Authority.

The government aims to have an assurance company with a great capital and asset by combining the four reassurance companies.

"Currently, Indonesia has small-scale state-owned reassurance companies. On the other hand, we need reassurance companies that can cover underwriting activities in large volumes," he said.

Meanwhile, the average loss of Indonesias potential reassurance premium is about Rp8 trillion, or about US$676 billion, per year that runs to overseas reinsurers.

"With the formation of the Indonesian Reassurance, the country can enjoy all the potential advantages inherent in accepting foreign exchange," Dahlan said.

He added that the plan to operate the Indonesian Reassurance has received a positive response from European reassurance companies, such as those in Switzerland and the United Kingdom.

"They have contacted us and are ready to establish cooperation with Indonesian Reassurance," Dahlan added.

ANTARA | INE