Insurance Coverage for Natural Disasters: Legal Perspectives from Indonesia and Japan

Abstract

Background: Natural disasters pose significant risks to insurers and policyholders, particularly in disaster-prone regions like Indonesia and Japan. The legal frameworks governing disaster insurance vary significantly between these countries, impacting recovery efforts and financial stability.
Objective: This study examines the legal provisions for natural disaster insurance in Indonesia and Japan, focusing on coverage, claims processes, and government involvement. The objective is to evaluate the effectiveness of these frameworks in mitigating disaster impacts.
Methodology: A comparative legal analysis is conducted, reviewing national laws, government policies, and industry practices. The study includes interviews with insurance regulators and claims professionals, along with an analysis of major disaster cases.
Findings: Japan's robust legal framework, supported by government-backed insurance schemes, ensures rapid disaster recovery. In contrast, Indonesia faces challenges due to limited policy coverage and inconsistent enforcement. Recommendations include adopting mandatory disaster insurance policies and increasing public awareness to improve resilience.