Liga Asuransi – Hello risk takers, we are back to discussing developments and events in the world of insurance in Indonesia in the last week. Again, we would like to convey that in daily business matters, insurance objects are not only about vehicle, health, life and property insurance, but there is still a very wide range of objects that can be insured. Almost all business processes from A to Z can be protected by insurance. In this edition, as usual, we have again collected 7 selected news related to insurance that are good for you to know. Also included are things that are currently hot lately regarding Tapera.
As always, if you are interested in this article, please share it with your colleagues so they can understand it as well as you.
BNI Life Insurance Records Highest Money Market Unit Link Performance until June 2024
PT BNI Life Insurance (BNI Life) recorded the best performance for money market type unit link products until June 2024. Based on existing data, the Blife Link Liquid Money Market product managed to provide the highest return of 2.8%. Meanwhile, the mixed unit link product, Blife Link Mixed Combination, recorded a return of 2.49%.
Infovesta data also shows positive performance for mixed and money market link units with increases of 0.34% and 0.36% respectively as of June 2024. Year to date (ytd), money market link units rose 1.53%, while mixed link units experienced a decrease of 1.24%.
Arry Herwindo, General Manager Corsec, Legal, and Corcomm BNI Life, explained that the increase in money market link unit returns was caused by the increase in the reference interest rate to the level of 6.25%. “The high BI 7DRR benchmark interest rate supports the money market, while the mixed type gets support from the stocks selected in the portfolio,” said Arry to Bisnis, Thursday (4/7/2024).
However, several stock type link units still recorded negative performance in line with market conditions which showed that the Composite Stock Price Index (IHSG) until June 2024 was still negative. Infovesta noted that unit link shares contracted 1.97% ytd, although there was an increase of 1.02% on a monthly basis as of June 2024.
Arry is optimistic that the bond market can provide benefits, especially if companies can capitalize on the existing momentum. “Customers can also look at money market instruments amidst the current high benchmark interest rates,” he added. He is also optimistic that unit-linked products can still grow amidst decreasing premiums in the first quarter of 2024.
BNI Life’s regular unit link product offers protection and high sum assured benefits. Based on data from the Indonesian Life Insurance Association (AAJI), unit link premiums decreased to Rp. 19.22 trillion in the first quarter of 2024, down 16.4% on an annual basis (year on year/yoy) compared to the first quarter of 2023 which reached Rp. 22.98 trillion. BNI Life unit link premiums also decreased 21% to IDR 249 billion in the first quarter of 2024.
However, in semester I/2024, BNI Life’s unit link premium income recorded an increase of 7.8% yoy to IDR 604.4 billion. Arry mentioned several factors that could influence customer sentiment towards BNI Life unit linked products, especially regular unit links, including transparent insurance benefits regarding product risks, quality of customer service, as well as product innovation that suits customer needs.
To increase unit link premiums, BNI Life uses several approaches, such as holding seminars, webinars and workshops to increase public understanding of the benefits of unit link products. In addition, BNI Life provides unit link products that are more flexible and suit individual needs and customer risk profiles, as well as launching products with additional features such as health protection or attractive investments. “Implementation of these strategies is expected to increase the attractiveness of unit-linked products and encourage increased premiums,” concluded Arry.
Total TUGU Shareholders Increased 16.33%, Reflecting Investor Optimism
The number of shareholders of PT Asuransi Tugu Pratama Indonesia Tbk (TUGU) continues to show an increase throughout 2024, surpassing other public general insurance companies. Data from RTI Infokom records that the number of TUGU shareholders as of the end of May 2024 reached 7,419 investors, an increase of 1,042 investors or 16.33% compared to the position at the end of December 2023 which was 6,377 shareholders.
Abdul Azis, Kiwoom Sekuritas analyst, said that the growth in the number of investors in TUGU shares reflects investors’ optimism regarding the company’s performance. Of the 12 general insurance companies listed on the Indonesia Stock Exchange (BEI), there are 9 issuers that recorded an increase in the number of investors in 2024, with TUGU recording the highest increase.
“The trend of TUGU share accumulation is carried out by both domestic and foreign investors. Throughout 2024, foreign investors will net buy TUGU shares amounting to IDR 8 billion. Although this value is relatively small because general insurance companies in Indonesia generally have small capitalization (small cap), the inflow to “TUGU shares are the main driver of the flow of foreign funds into the insurance sector which reached IDR 8.9 billion,” said Azis on Thursday (4/7/2024).
Azis explained that the two main factors that support the increase in the number of shareholders of TUGU, which is a subsidiary of BUMN PT Pertamina (Persero), are financial performance which continues to grow strongly and valuation which is still too cheap.
Based on the non-consolidated monthly financial report as of May 31 2024, TUGU, which has the branding name Tugu Insurance, managed to record an insurance business profit of IDR 285 billion, growing 60% year-on-year (yoy) compared to the same period the previous year of IDR 178 billion . This improvement in financial performance was driven by growth in underwriting results in the general insurance segment which reached IDR 336 billion as of May 2024, up 38% yoy compared to IDR 244 billion in May 2023.
The company’s investment income also increased 25% yoy to IDR 137 billion in May 2024, up from IDR 110 billion in the same period the previous year. On the other hand, TUGU’s total operational expenses only rose moderately by 7% yoy to IDR 189 billion in May 2024, from IDR 176 billion in the same period in 2023.
“The positive performance during the first five months of 2024 has become a positive catalyst that has sparked optimism among investors, including foreign investors. With this achievement and share prices which have tended to be stable in the last month, TUGU’s valuation has become attractive so it is natural that investors are looking for it,” concluded Azis.
In trading on Tuesday (2 July 2024), TUGU’s share price closed down 0.48% to IDR 1,045 per share. TUGU’s market capitalization value reached IDR 3.72 trillion with a Price to Book Value (PBV) ratio of 0.38x.
A number of analysts maintain their recommendation to buy TUGU shares for the next 12 months with a target price above IDR 2,000. Shinhan Sekuritas set the target price for TUGU shares at IDR 2,050, while Kiwoom Sekuritas set the target price at IDR 2,100.
Corruption Eradication Committee Investigates Head of Jakarta Jasindo Insurance Branch regarding Alleged Corruption
Corruption Eradication Commission (KPK) investigators are scheduled to examine the Head of the Jakarta Jasindo Insurance Branch, Ari Prabowo, on Friday (28/6). Ari will be asked for information regarding the alleged corruption case at Jasindo which is currently being investigated.
“Today, Friday (28/6), the examination of witnesses suspected of criminal acts of corruption (TPK) in Jasindo. On behalf of Ari Prabowo, Head of the Indonesian Jasa Insurance Branch, KC Jakarta S. Parman,” said KPK spokesperson Tessa Mahardika on Thursday (4/7 /2024).
However, Tessa was not prepared to explain in more detail regarding the investigation that would be carried out on Ari in this case. The examination was carried out because Ari was suspected of knowing important information regarding the alleged corruption case.
The KPK is currently investigating allegations of corruption at PT Asuransi Jasa Indonesia (Jasindo) Persero. This case is suspected to have cost the state tens of billions of rupiah.
Corruption Eradication Committee Spokesperson Tessa Mahardika Sugiarto stated that state losses due to alleged corruption reached IDR 36 billion. “The estimated state loss is IDR 36 billion,” Tessa told reporters on Tuesday (2/7/2024).
Tessa explained that the alleged corruption at PT Jasindo was related to the alleged corruption at PT Indonesian National Service (Pelni) (Persero). The two cases of alleged corruption have now entered the investigation stage.
This case attracted public attention because it involved a large insurance company and caused significant losses for the state. The Corruption Eradication Commission is committed to thoroughly investigating this case and ensuring that all parties involved are responsible for their actions.
Source : https://www.rri.co.id/hukum/802424/dugaan-korupsi-asuransi-jasindo-jakarta-kpk-panggil-kacab
MSIG Life Insurance Indonesia is Optimistic about Growth amidst the Weakening Rupiah
Even though the rupiah exchange rate is weakening, PT MSIG Life Insurance Indonesia remains optimistic about the company’s positive growth. CEO and President Director of MSIG Life, Wianto Chen, revealed that annual new business premium income (APE) had reached IDR 1.3 trillion, showing growth of 15 percent Year on Year (YoY).
“The life insurance industry is transforming positively amidst the challenging global situation. This condition is also supported by increasing public awareness and support from the Indonesian government,” said Wianto Chen in the Public Expose.
Wianto added that the company’s financial condition is very healthy, reflected in the Risk Based Capital (RBC) of 2011.5 percent, far above the minimum requirement from the regulator which is only 120 percent.
Continuing the transformation and medium-term strategy “Great 2025”, Wianto explained that MSIG Life’s strategy in 2024 will rely on accelerating business growth, optimizing operations and strengthening governance.
MSIG Life Director, Herman Sulistyo, also revealed that the company’s revenue from agency channels in 2023 will grow 110 percent YoY. This channel is the backbone of the company’s business together with the bancassurance channel.
“This condition further strengthens the company’s efforts to expand its reach, retail network, increase inclusion and insurance literacy in Indonesia,” said Herman Sulistyo.
With the various strategies and transformations carried out, MSIG Life is optimistic that it can continue to develop and make a positive contribution to the life insurance industry in Indonesia.
Source : https://www.jawapos.com/ekonomi/014829584/nilai-tukar-melemah-kondisi-asuransi-jiwa-indonesia-tumbuh
GEGI Records Positive Performance in Miscellaneous Insurance, Premiums Increase 245%
PT Great Eastern General Insurance Indonesia (GEGI) recorded positive performance in the miscellaneous insurance segment. GEGI Marketing Director, Linggawati Tok, revealed that the company’s premium income from miscellaneous insurance as of May 2024 reached IDR 16 billion, an increase of 245% compared to the same period the previous year which amounted to IDR 6.5 billion.
“This positive achievement is supported by the high growth of two superior products in the miscellaneous insurance business line, namely money insurance and gadget insurance, which contributed 54% of the total miscellaneous insurance premium achievement as of May 2024,” said Linggawati to Cash, Tuesday (2/7).
Linggawati explained that the prospects for miscellaneous insurance are still very promising, especially with increasing sales of gadget products and increasing awareness among users to insure their gadgets. Apart from that, more and more shops and distributors are also offering insurance guarantee packages for every gadget purchase as part of their after-sales service.
For money insurance products, GEGI is increasingly optimistic that it can increase sales by collaborating with several banks or financial institutions to protect the risk of theft, robbery or other losses. Money insurance products include protection for money in transit, money in storage (money in safe), and money at ATMs or at sales counters for companies and MSMEs.
For information, the Indonesian General Insurance Association (AAUI) recorded premium income from various insurance business lines in the first quarter of 2024 of IDR 1.54 trillion, growing by 24.9% compared to the same period last year which amounted to IDR 1.23 trillion.
With these various achievements, GEGI is optimistic that it can continue to develop the miscellaneous insurance segment and make a positive contribution to the general insurance industry in Indonesia.
Multifinance and Insurance Industries Faced with Macroeconomic Challenges
Business players in the finance and insurance sectors must strengthen their strategies amidst challenging macroeconomic conditions. With high inflation, rising interest rates, and the rupiah exchange rate weakening to IDR 16,427 per USD, these two sectors have to face significant market pressure.
The Financial Services Authority (OJK) has completed a clean-up in the multi-finance sector by revoking the permits of 62 companies from 2016 to June 2024. OJK has also launched a roadmap for the finance industry in three phases, starting with strengthening the foundation in 2024-2025, consolidating and creating momentum in 2026-2027, and adjustment and growth in 2028.
According to the Infobank Research Bureau, Life Multifinance profits will grow 12.98 percent to IDR 23 trillion throughout 2023. However, there are 55 companies whose profits have fallen and 25 companies have lost money. In this year’s ratings, 14 companies performed “Not Good” while 79 companies performed “Very Good.”
Multifinance companies have to face tough competition with expensive funding costs, as well as the risk of default, fraud and financial crime. The bitter experience when a number of players targeted peripheral markets with expensive interest rates or financed other high-risk multifinance products is an important lesson.
The general insurance industry is also facing challenges in terms of increasing claims. The Infobank Research Bureau recorded a significant increase in general insurance claim costs by 37.43 percent to IDR 34.74 trillion in 2023. As of April 2024, general insurance claim costs increased 22.65 percent to IDR 12.03 trillion.
The general insurance industry’s premium income was pressured by the weak purchasing power of the retail and MSME sectors as well as the weakening of the corporate sector. Gross premium growth as of April, which reached 24.80 percent yoy, was influenced by the shift in premium recording last year and the role of the captive market in the corporate segment from large players such as Sinarmas, Astra Buana and Tugu Pratama. However, if the group premium is excluded, general insurance premium production does not actually grow.
In the 2024 Insurance Rating 114 by the Infobank Research Bureau, general insurance gross premium income grew 27.18 percent to IDR 99.35 trillion throughout 2023. However, there were 12 companies whose premiums fell and four companies were unknown because they did not issue financial reports. A total of 71 insurance companies performed “Very Good” and three companies performed “Not Good.”
Meanwhile, of the 50 life insurance companies, only 16 players performed “Very Good” and five were rated “Not Good.” In the midst of a contraction in gross premium income of 7.43 percent, there were 29 life insurance companies that managed to record gross premium growth.
In terms of assets, life insurance performance was pressured by the decline in the capital market. Life insurance investment fell 0.86 percent to IDR 510.82 trillion as of April 2024, with the value of shares and mutual funds depreciating by 17.13 percent to IDR 205.69 trillion.
The general insurance industry will enjoy growth of 23.72 percent in 2023 and 21.26 percent as of April 2024, despite facing the challenge of a sluggish real sector. The finance industry must also anticipate the trend of increasing non-performing financing (NPF) from 2.32 percent in 2022 to 2.44 percent in 2023, and increasing again to 2.45 percent as of March 2024.
With these various challenges, the finance and insurance sectors must continue to innovate and strengthen strategies to face dynamic economic conditions.
IFG Life Improves Services with Changes in Board of Directors Composition After Acquisition of Mandiri Inhealth Shares
After the acquisition of Mandiri Inhealth shares, PT Asuransi Jiwa IFG (IFG Life) is committed to continuing to provide the best service and improving the welfare of the Indonesian people through reliable and trusted insurance products and services.
As a first step towards this commitment, IFG Life made changes to the composition of the board of directors. PT Bahana Pembinaan Usaha Indonesia (Persero), known as the Indonesia Financial Group (IFG), and PT Bahana Kapital Investa as shareholders of IFG Life, on Thursday, June 27 2024, officially changed the composition of the board of directors at IFG Life. This is stated in a copy of the Circular Decision of the Shareholders of PT Asuransi Jiwa IFG Number: 11/KepSir-PS/BPUI/VI/2024 and Number: 009/BKI/06/2024, which appointed Budi Tua Arifin Tampubolon as Main Director of PT Asuransi Jiwa IFG.
The latest composition of the IFG Life Board of Directors is as follows:
- Main Director: Budi Tua Arifin Tampubolon
- Director of Compliance and Risk Management: Eli Wijanti
- Operations Director: Iskak Hendrawan
- Individual Business Director: Fabiola Noralita
- Corporate Business Director: Bugi Riagandhy
- Finance Director: Ryan Diastana Firman
- Investment Director: Mufri Dharmawan
IFG Corporate Secretary, Oktarina Dwidya Sistha, stated that this change in directors is a form of IFG’s commitment as a holding in improving performance, governance, risk management, as well as ensuring business line strategies run well and sustainably.
“We fully support the current performance of the IFG Life Board of Directors to bring positive changes to the company in the insurance industry and make a real contribution to society. “With this new composition of directors, we hope that IFG Life can continue to expand the scope of its protection-based insurance business in meeting the public’s insurance product and service needs, as well as becoming a company that grows healthier, bigger and more sustainably,” said Sistha.
With these changes, IFG Life is ready to go further in providing better insurance services and contributing to the welfare of the Indonesian people.
This news is brought to you by L&G Insurance Brokers, insurance broker experienced in Indonesia.
—
INSURANCE AFFAIRS FOR YOUR BUSINESS? DON’T WASTE YOUR TIME AND CONTACT US NOW
24 JAM L&G HOTLINE: 0811-8507-773 (CALL – WHATSAPP – SMS)
website: lngrisk.co.id
—
