The Indonesian General Insurance Association (AAUI), in partnership with the United Nations Development Programme (UNDP), has officially launched a national roadmap for agricultural insurance development covering the years 2025 to 2030. The roadmap was submitted to Indonesia’s Financial Services Authority (OJK) in December 2024.
The initiative aims to build a sustainable agricultural insurance ecosystem to support national food security and offer stronger risk protection for farmers across the country.
At a soft launch event held in Jakarta on March 24, 2025, AAUI Chairman Budi Herawan emphasized the critical role agriculture plays in Indonesia’s economy. He highlighted the sector’s exposure to numerous risks, including extreme weather, climate change, pest outbreaks, diseases, and fluctuating commodity prices. Herawan called for a systemic and integrated insurance approach to better shield farmers from these growing challenges.
The roadmap was developed through collaboration between AAUI, the UNDP’s Insurance & Risk Finance Facility (IRFF), and other stakeholders. It outlines clear strategies to improve risk mitigation and enhance farmer welfare by expanding access to tailored insurance solutions.
Djonieri, OJK’s head of Regulation and Development of Insurance, Guarantee, and Pension Funds, underscored the importance of parametric insurance. These products provide payouts based on predefined indicators—such as rainfall or temperature levels—offering farmers faster and more predictable financial relief during adverse conditions.
He also stressed that Indonesia’s high vulnerability to natural disasters makes the development of innovative insurance products a top priority.
In addition to strengthening protection for the agricultural sector, the roadmap seeks to increase interest from the insurance industry and promote collaboration among insurers, government agencies, and regulators.
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