Liga Asuransi – Without realizing it, we have entered December 2023, the last month of 2023. Of course, we have gone through a lot of events this year, and of course with good risk management, it will make you calmer during this time.
In the second week of December 2023, we talk again about 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 the first week of December 2023, 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.
Maipark Committed to Reaching Capital Target of IDR 1 Trillion by 2026 Despite Facing Equity Challenges
Reinsurance company PT Reinsurance Maipark Indonesia (Maipark) faces the challenge of meeting capital requirements of IDR 1 trillion in 2026, in line with policies set by the Financial Services Authority (OJK). Even though the company’s equity until October 2023 still reaches IDR 694 billion, which does not meet the regulations set by the OJK, the Main Director of Maipark Indonesia, Kocu Andre Hutagalung, expressed optimism that the capital target can be achieved through organic growth until 2026.
In an interview after the Maipark Award 2023 & MCM 3.0 Launching event in Jakarta on Tuesday (28/11/2023), Kocu expressed his belief that organic growth will be the key to achieving the capital target. However, Kocu realizes that to achieve the capital target of IDR 2 trillion in 2028, new sources of capital are needed, both from existing shareholders and other parties who are willing to contribute.
Maipark shareholders involve several entities, including PT Asuransi Multi Artha Guna Tbk, PT Asuransi Tugu Pratama Indonesia, PT Asuransi Astra Buana, PT Asuransi Central Asia, PT Asuransi Jasa Indonesia, PT Asuransi Sinar Mas, PT Asuransi Wahana Tata, PT Sompo Insurance Indonesia , PT AIG Insurance Indonesia, and 70 other companies.
In the financial report as of October 31 2023, Maipark recorded positive growth in several aspects. Total gross premiums rose to IDR 161 billion or an increase of 12.5% compared to the same period the previous year. Meanwhile, underwriting results and recorded profits also increased. Nonetheless, the company needs to face the challenge of increasing its equity to meet regulatory regulations. Even so, Maipark remains committed to continuing to grow and comply with applicable regulations.
Death Claims Drop 9.7% in the Life Insurance Industry, While Health Claims Soar
The Indonesian Life Insurance Association (AAJI) noted a downward trend in death claims in the life insurance industry, showing significant changes since the Covid-19 pandemic subsided. The latest data records a decline of 9.7%, with total claims reaching IDR 8.04 trillion in the first nine months of 2023. Previously, in September 2022, death claims reached IDR 8.91 trillion.
Even though there was a decrease in death claims, there was a significant increase in health claims, which reached IDR 15.24 trillion. Edy Tuhirman, Head of AAJI’s Operational Division of Excellence, IT & Digital (Customer Centricity), revealed that health insurance claims experienced a jump of 32.9% year on year.
This downward trend in death claims is not a new phenomenon, in line with improvements in people’s mortality rates since the Covid-19 pandemic began to subside. Last year, death claim payments decreased by 43.8%, reaching IDR 11.88 trillion throughout 2022, even though in the previous year it reached IDR 21.14 trillion, where Covid-19 cases were still high.
In semester I/2023, death claims fell 13% to IDR 5.18 trillion, compared to IDR 5.96 trillion in semester I/2022. Novita Rumngangun, Head of Marketing & Communications at AAJI, stated that the decrease in death claims was due to an increase in the community’s better mortality rate in line with the reduced impact of the Covid-19 pandemic.
Overall, during the January-September 2023 period, the life insurance industry distributed claims and benefits amounting to IDR 122.46 trillion to 7.69 million people. Although death claims decreased by 4.4% overall compared to the same period the previous year.
Insurance Premium Income Increases, OJK: Financial Condition of the Insurance Industry Remains Solid
The Financial Services Authority (OJK) released the latest data regarding the performance of the insurance sector in Indonesia, which shows that the insurance industry’s premium income during January-October 2023 reached IDR 264.23 trillion. Although this figure shows an increase of 3.54% on an annual basis, there is a significant improvement compared to the previous month.
According to the Chief Executive of the OJK Insurance, Guarantee and Pension Fund Supervisor, Ogi Prastomiyono, insurance premium income in October 2023 has increased compared to September 2023, which reached IDR 228.51 trillion or a decrease of 1.57% year-on-year ( yo). Ogi also explained that although life insurance premium income was still experiencing a contraction of 6.93% yoy, mainly influenced by premium income in the Paydi business line, the trend had improved from the previous month.
On the other hand, accumulated general insurance and reinsurance premiums showed positive growth of 20.4% yoy, reaching IDR 117.72 trillion in October 2023. OJK noted that insurance capital conditions have also strengthened, with risk-based capital (RBC) in the insurance industry general and reinsurance of 340.54% in October 2023. Likewise with the RBC of the life insurance industry which reached 435.98%, far above the OJK threshold of 120%.
Although there is still some contraction in life insurance premium income, the overall performance of the insurance sector shows the solidity of the industry’s financial condition. With continued growth in premium income and strong capital conditions, the prospects for the insurance industry in Indonesia remain positive.
Climbers Affected by the Eruption of Mount Marapi Are Protected by Insurance, Climbing Mount Marapi Apply E-Ticket
The West Sumatra Natural Resources Conservation Agency (BKSDA) confirmed that the climbers who were trapped in the eruption of Mount Marapi on Sunday (3/12) were protected by insurance. Eka Dhamayanti, Daily Executive Head of the West Sumatra BKSDA, explained that climbers who use the official route or buy tickets online to the West Sumatra Mount Marapi Nature Tourism Park (TWA) have received insurance protection from Amanah Githa.
“Ticket prices for visits to TWA Mount Marapi start from IDR 5,000 per day for Monday-Friday, and IDR 7,500 per person per day for Saturday-Sunday,” said Eka Dhamayanti. From this ticket payment, each climber insures himself for IDR 2,500 per person, ensuring that in an emergency like this, an insurance claim can be submitted for casualties.
Although the BKSDA has not been able to provide further information regarding insurance claims for injuries resulting from the eruption of Mount Marapi, Eka emphasized that the evacuation and safety of all climbers is currently a top priority. Regarding ticket payments, Eka explained that the funds from the tickets were deposited into the state treasury in accordance with Government Regulation Number 12 of 2014 concerning Types and Rates of Non-Tax State Revenue (PNBP).
Eka also clarified that information regarding the evacuation conditions for climbers was still in process, and coordination was continuing with the Basarnas, TNI, Polri, BPBD and BKSDA teams. Since August 2023, the West Sumatra BKSDA has implemented E-Ticket for visitors who will climb Mount Marapi. This system allows online registration via the West Sumatra BKSDA website to facilitate visitor data collection, increase accountability for climbing management, and simplify the registration process for climbers.
Igloo, a Singapore-based insurance startup, raises US$ 36 million in funding for expansion in Asia
Singapore-based insurance startup, Igloo, announced its success in raising US$36 million (around IDR 558.23 billion) in its Pre-Series C funding round. This funding was led by global investor Eurazeo and insurance company BNP Paribas Cardif, with participation from Previous investors such as Openspace and La Maison also participated in the Series B and Series B+ rounds. Igloo, which previously raised Series B+ funding of US$100 million or IDR 1.5 trillion under the management of InsuResilience Investment Fund II overseen by BlueOrchard, claims that their business model, which focuses on engineering techniques and data, will bring them closer to profitability in in 2024.
This investment comes after approximately 10 months since its Series B+ funding, and Igloo has plans to use this additional funding to unlock merger and acquisition opportunities at both horizontal and vertical levels. The company will also increase the number of workers by 20 percent in the fields of engineering, commercial, strategy and insurance products. In addition, they will focus on improving motor vehicle insurance products, health, climate-related products, digitalization of underwriting and claims, as well as AI and blockchain technology.
Igloo Indonesia Country Manager, Henry Mixson, stated that this investment will expand the company’s ability to provide insurance services throughout Indonesia and provide more protection to customers. Igloo plans to achieve this through expanded partnerships with industry stakeholders, increased B2C offerings through the website, and growth in new verticals. Mixson also emphasized that Igloo will take advantage of existing opportunities to provide more accessible and affordable insurance, with the aim of increasing insurance literacy and penetration in Indonesia.
Overcoming Trade Receivables Risk with Trade Credit Insurance Protection from Sinar Mas Insurance
In the risky world of business, late payments from key buyers can have a serious impact on the company. Can you imagine what it would be like if one of your business partners couldn’t fulfill its obligations on time? In the midst of current economic uncertainty, companies in Indonesia need to consider appropriate protection, especially in facing the potential worst-case scenario regarding unpaid bills.
Trade Credit Insurance from Asuransi Sinar Mas (ASM) has been offering reliable and trustworthy solutions since 1985. Under the leadership of Director Njoman Sudartha, ASM has successfully provided protection worth more than IDR 25 trillion in trade transactions. This is not just a statistic, but also real evidence of ASM’s commitment to protecting business sustainability in Indonesia.
Njoman Sudartha said, “Demand for trade credit insurance has increased significantly, especially from local and multinational companies. This trend is growing in line with the various challenges faced by the business world in recent years, especially due to the pandemic.”
ASM excels in a dynamic trading landscape by offering comprehensive coverage and establishing a strategic partnership with Atradius. With Atradius as a partner that has a global presence in more than 50 countries, ASM can provide business trade support at the highest level.
Trade credit insurance is nothing new and has been proven to be an effective tool worldwide for reducing risks related to non-payment, bankruptcy and unforeseen disruptions. This protection is especially important in the face of current economic uncertainty.
Trade Credit Insurance from ASM acts as a financial safety net, providing peace of mind to businesses involved in cross-border transactions. ASM’s commitment to protecting trillions in trade transactions reflects its determination to advance economic resilience.
BTN and Jiwasraya Reach Agreement of IDR 700 Billion, IFG Life Waits for PMN Funding
PT Bank Tabungan Negara (Persero) Tbk. (BBTN) and PT Asuransi Jiwasraya (Persero) have reached an agreement on the payment of credit life insurance claims worth IDR 700 billion. Even though the assessment as of December 2023 shows a value of IDR 500 billion, the President Director of BTN, Nixon L.P. Napitupulu remains optimistic about achieving the profit target of IDR 3.2 trillion by the end of 2023 if the claim of IDR 500 billion can be realized.
However, Jiwasraya’s obligation for this claim was transferred to PT Asuransi Jiwa IFG (IFG Life), with only around 83% of the policies having been successfully transferred until early December 2023. Head of Corporate Secretary IFG Life, Gatot Haryadi, stated that the BTN credit life insurance portfolio was still is at Jiwasraya and has not been transferred to IFG Life. “IFG Life is still waiting for funding from PMN [State Capital Participation] to be able to transfer AJK BTN from Jiwasraya,” said Gatot to Bisnis on Thursday (7/12/2023).
Funding from PMN, amounting to IDR 3 trillion this year and IDR 3.56 trillion in the 2024 budget year, is expected to be realized no later than the first quarter of 2024. IFG Life has received a transfer of Jiwasraya customer policies of around IDR 32.13 trillion or around 83% of the total policies that have been restructured. Apart from that, IFG Life has also paid claim benefits worth IDR 9.65 trillion as of November 30 2023.
Previously, the Main Director of IFG, Hexana Tri Sasongko, explained that there was only one policy in the name of Bank BTN, but there were around 600,000 participants from BTN credit life insurance customers guaranteed by Jiwasraya. An agreement on a bill settlement scheme has been reached with BTN, with a settlement target at the end of this year or at the latest in the first quarter of 2024. Hexana added that the restructuring would be carried out quickly through the signing of a transfer deed between Jiwasraya and IFG Life, so that the portfolio transferred to IFG Life would be healthy.
This article is brought to you by L&G Insurance Broker, an insurance broker in Indonesia.
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