Liga Asuransi – Hello risk takers, in the 1st week of February 2024, we will once again discuss the world of insurance, because insurance is not only limited to vehicles and life, especially for business protection coverage, insurance still has a very wide reach. In this first week of February 2024, we are again collecting 7 selected news related to insurance that are good for you to know.
As always, if you are interested in this article, please share it with your colleagues so they can understand it as well as you.
Looking to the Future: Recovery and Bright Prospects for the Indonesian Financial Sector
Global challenges always test the sustainability of a country’s financial sector. In the Indonesian context, the Financial Services Authority (OJK) has underlined the importance of vigilance and resilience testing in facing various lurking risks. In the Financial System Stability Committee (KSSK) Press Conference, Mahendra Siregar, Chairman of the OJK Board of Commissioners, highlighted the need for companies in the financial sector to continue to pay attention to risk factors and carry out regular stress tests.
The KSSK meeting, which involved various important figures in the financial sector, became a forum for formulating policies for preventing and handling financial crises. However, amidst global uncertainty, the Indonesian banking industry in 2023 will show extraordinary resilience. Solid capital and a high capital adequacy ratio are the main drivers in maintaining the stability of this sector.
Not only the banking sector, but the Indonesian capital market also shows positive performance. The increasing support from domestic investors, coupled with the significant growth in the number of capital market investors, provides a breath of fresh air for the domestic capital market. Even though there was net selling by foreign investors, the significant growth in the IHSG and the continuing increase in market capitalization value indicate that the Indonesian capital market remains attractive to investors.
The stable economic recovery is also reflected in the decline in the number of Covid-19 restructuring loans, indicating that business sectors are starting to recover from the impact of the pandemic. In addition, well-maintained credit quality and adequate banking liquidity are the main pillars in maintaining financial sector stability.
With all these positive achievements, OJK is optimistic that there is still very wide room for growth for the Indonesian financial industry. By maintaining vigilance and continuing to innovate, the Indonesian financial sector is ready to make an optimal contribution to the national economy.
Markel Group: Moving Forward with Resilience amidst Market Challenges
Markel Group, one of the major players in the global reinsurance industry, announced eye-catching 2023 financial results. Even though underwriting profits experienced a significant decline compared to the previous year, this company managed to record growth in gross premium and net premium volumes.
According to a report quoted from Reinsurance News, Markel’s underwriting profit in 2023 will reach US$132.7 million, a decrease of 79 percent from the previous year which reached US$626.6 million. This decrease was caused by unfavorable developments in the previous year’s loss reserves.
Nevertheless, gross premium volume growth of four percent to US$10.27 billion and net premiums increased two percent to US$8.4 billion, showing that Markel has continued to succeed in maintaining its business growth.
The group’s combined ratio rose to 98.4 percent from 91.7 percent in the previous year, mainly due to a higher attrition loss ratio. However, in the face of challenges such as the Hawaiian forest fires and Hurricane Idalia, Markel continued to show resilience by reporting a comprehensive profit of US$2.3 billion for 2023, compared to a loss of US$1.2 billion in the previous year.
This success was supported by investment profits reaching US$1.5 billion, indicating that this company’s investment strategy is producing positive results.
In facing uncertain market dynamics, Markel Group continues to build resilience and take strategic steps to strengthen its position in the global reinsurance market.
Source: https://mediaasuransinews.co.id/asuransi/laba-underwriting-markel-group-anjlok-79-di-2023/
TUGU Asuransi’s Glorious Achievements: Superior Performance and Capital Strength in 2023
PT Asuransi Tugu Pratama Indonesia Tbk (TUGU) achieved resounding success in 2023 with impressive performance achievements. In fact, TUGU’s achievements surpassed those of the general insurance and reinsurance industries which also showed solid growth.
According to data from the Indonesian General Insurance Association (AAUI), total insurance and reinsurance industry assets reached IDR 244 trillion by the end of the third quarter of 2023, recording growth of 6% compared to the same period the previous year. This growth was driven by an increase in investment value which reached IDR 118 trillion, an increase of 8.7% on an annual basis. Meanwhile, capital in the insurance and reinsurance industry also increased by 7.7% to IDR 83 trillion.
TUGU has succeeded in standing out among the many general insurance companies in Indonesia with impressive performance achievements. TUGU’s total assets for the parent company alone reached IDR 15.3 trillion as of the end of September 2023, an increase of 18.6% compared to the same period in the previous year. This growth exceeds industry growth, so that its market share in terms of assets increased from 6.6% to 7.4%.
Apart from that, TUGU’s asset growth was also driven by an increase in annual investment value of 38.6%, reaching IDR 7.9 trillion at the end of September 2023. Not only that, TUGU’s profitability ratio is also superior compared to the industry, with a return on capital (ROE). ) and return on assets (ROA) which reached 17% and 7% respectively.
TUGU’s advantages lie not only in growth and profitability factors, but also in terms of strong capital. With a consolidated equity value of almost IDR 24 trillion and a parent Risk Based Capital (RBC) value of 570% in 9M23, TUGU has great ability to deal with risk.
With this brilliant achievement, TUGU is optimistic that it will continue to grow until the end of 2023 and sees positive prospects in 2024. This company even has the opportunity to once again surpass the industry with a strategy focused on digitalization, efficiency and expansion into non-captive segments.
Facing New Challenges The Insurance Industry Prepares to Face the Digital Risk Storm
In an ever-changing global landscape, the insurance industry is faced with new challenges coming from various directions. According to the latest Global Forecast 2024 report from law firm Kennedys, geopolitical risks triggered by deglobalization are one of the main threats to the industry.
However, challenges do not only come from geopolitics. The development of artificial intelligence (AI) also brings new risks to insurance companies. While AI has the potential to improve service and efficiency, its unethical use can produce false evidence in fraudulent claims, resulting in significant losses for companies and their clients.
Additionally, environmental, social and governance (ESG) factors are also becoming an increasing concern. Biodiversity loss is one example acknowledged in the Kennedys report. This highlights the importance for insurers to take environmental impacts into account in assessing risk and setting policies.
The report also provides concrete examples of how AI system failures can lead to adverse claims. From fires caused by careless warehouse cleaning robots to financial losses due to hacked AI chatbots, these challenges highlight the new complexities facing the insurance industry.
For the Asia Pacific region, cyber attacks, inflation and automation were identified as potential future claim threats. This highlights the importance for insurance companies to continue to adapt and improve their ability to manage these new risks.
In facing these challenges, insurance companies need to increase their vigilance, develop responsive policies, and adopt safe and ethical technology. Only with these steps can the insurance industry remain relevant and resilient in the ever-changing digital era.
BRI Life: Commitment to Customer Satisfaction Through Timely Payment of Claims and Benefits
PT Asuransi BRI Life (BRI Life), a government-owned life insurance company, has shown its dedication in fulfilling its obligations to policyholders by paying claims and benefits amounting to IDR 5.59 trillion throughout 2023. BRI Life Operations Director, Yossie William Iroth, stated that the number of claims and benefit payments increased by 10.59% compared to the previous year, showing the company’s commitment to providing reliable protection to its customers.
Yossie highlighted that the increase in claims and benefits occurred in all distribution channels, with respective increases of 4.17% for distribution channels, 23.99% for in-branch channels, and 15.96% for corporate channels. However, there was a decrease in claims from alternate and agency channels by 12.51% and 22.04% respectively.
The largest claims paid came from the credit life insurance distribution channel, according to Yossie. He also emphasized that BRI Life continues to strive to increase efficiency in the payment of claims and benefits, by achieving a level of compliance with the Service Level Agreement (SLA) of 98%. Claims and benefits payments are made quickly, where traditional product claims are processed within a maximum of 5 working days, while unit-linked products take 9 working days, and micro insurance claims within 3 working days.
Yossie emphasized that this compliance is proof of BRI Life’s commitment to providing the best service to its customers. Previously, Acting President Director of BRI Life, I Dewa Gede Agung, explained that in 2023, the company would improve its product portfolio to better suit the needs of BRI customers. In this way, BRI Life not only confirms its success in fulfilling financial obligations to customers, but also its commitment to providing reliable and timely protection.
OJK Encourages Risk Awareness: Indonesia’s Financial Industry Remains Resilient Amid Global Uncertainty
The Financial Services Authority (OJK) has submitted a request to the financial services sector to always anticipate risk factors that have the potential to affect future performance. In the Financial System Stability Committee (KSSK) Press Conference, Chairman of the OJK Board of Commissioners, Mahendra Siregar, emphasized the importance of conducting regular stress tests to measure the sector’s ability to overcome potential risks that may occur.
KSSK, which consists of financial sector policy makers, acts as a coordinator to take preventive and handling steps in dealing with financial system crises. The risks tested include a weakening of the Chinese economy, escalation of geopolitical tensions, fluctuations in export commodity prices and the rupiah exchange rate.
Despite being faced with conditions of global uncertainty, the Indonesian banking industry demonstrated resilience and strong competitiveness in 2023. Support from solid banking capital is reflected in the high Capital Adequacy Ratio (CAR) of the banking sector. In addition, the performance of the domestic capital market also showed sufficient strength, with positive growth despite the prospect of a global economic slowdown.
The Composite Stock Price Index (IHSG) recorded positive performance, being the highest in Southeast Asia after Vietnam. The growth in the number of capital market investors is also encouraging, reaching double digits. With these various achievements, OJK is optimistic that there is still wide room for growth for the Indonesian capital markets industry to provide optimal contributions to the national economy.
Challenges Towards Equity Standards: Life Insurance Players in Indonesia Struggle to Achieve Minimum Capital Requirements
The Indonesian Life Insurance Association (AAJI) revealed that a number of life insurance companies are still struggling to meet the minimum equity standard of IDR 250 billion set by the regulator. However, the majority of insurance players have approached this figure, with less than 10 companies still not meeting this requirement.
Chairman of the AAJI Management Board, Budi Tampubolon, stated that companies that still lack capital still have until the end of 2026 to achieve the capital target. However, the final decision rests with shareholders, who must decide whether it is time to inject additional capital.
Even though the capital increase process appears visible in the next two years, the final decision is still determined by shareholders. Even though there are several players who are still facing a lack of capital, Budi ensures that there are not too many of them.
In an effort to achieve minimum capital requirements, shareholders must consider investments that suit the company’s risk profile. With OJK regulations that set minimum equity standards, the life insurance industry is expected to strengthen its position in facing future challenges.
This article is brought to you by L&G Insurance Broker, insurance broker Indonesia..
—
LOOKING FOR INSURANCE PRODUCTS? DON’T WASTE YOUR TIME AND CONTACT US NOW
24 JAM L&G HOTLINE: 0811-8507-773 (CALL – WHATSAPP – SMS)
website: lngrisk.co.id
Email: customer.support@lngrisk.co.id
—
