Liga Asuransi – Hello risk takers, in the fourth week of April 2024 we will once again discuss developments and events in the world of insurance in Indonesia in the last week, because as we all know, the object of insurance is not only vehicles, life, health or property, but also The scope of objects that can be insured is very wide, especially in the business sector. 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.
As always, if you are interested in this article, please share it with your colleagues so they can understand it as well as you.
Allianz Life Indonesia Releases Premier Legacy Assurance: Traditional Insurance with Maximum Sum Insured of IDR 3 Billion
PT Asuransi Allianz Life Indonesia (Allianz Life) has launched its newest product, Premier Legacy Assurance, which offers a maximum sum assured of up to 300%. This means that customers can get insurance money of IDR 3 billion.
According to the Country Chief Product Officer of Allianz Life Indonesia, Himawan Purnama, customers will receive an additional 20% sum insured every 5 years of the policy period. Thus, customers can gain more benefits from this product.
The premium for this product is priced at IDR 500 million for direct payments or IDR 170 million per year with three periodic payments. Premier Legacy Assurance is a traditional type of insurance that does not have an investment element in it.
Himawan explained that Allianz manages its policyholders’ premiums by relying on investment instruments, especially Government Securities (SBN). The company has chosen underlying assets that are measurable and not aggressive, with one of the main choices being government bonds.
Meanwhile, the results of this product collaboration were carried out with PT Bank HSBC Indonesia. Premier Legacy Assurance offers strong financial protection with a large maximum sum insured, providing security and peace of mind for its customers.
PT Asuransi Simas Insurtech Records Growth in Vehicle Insurance Premium Income during Ramadan and Eid 2024
PT Asuransi Simas Insurtech reported positive performance during the Ramadan to Eid 2024 period, especially in vehicle insurance premium income. According to the President Director of Simas Insurtech, Teguh Aria Djana, the company recorded vehicle insurance premium income of IDR 18 billion during that period, which shows growth of 5% compared to the same period the previous year.
Teguh explained that the increase in premium income was due to additional collaboration with several aggregators. However, regarding vehicle insurance claims during the Ramadan to Eid period, the value is still in the process of being collected because most claims are submitted within 1-2 weeks after Eid.
The company targets premium income from vehicle insurance to reach IDR 250 billion this year. Meanwhile, Teguh is optimistic that the company’s overall premium target, which reached IDR 2.5 trillion or an increase of 13.64% Year on Year (YoY), can be achieved. To achieve this target, Simas Insurtech will implement effective strategies, including adding partnerships with e-Commerce and fintech.
Apart from that, the company is also making several changes to the mobile application and presenting several new products in 2024. This shows Simas Insurtech’s commitment to continuing to innovate and expand services to meet customer needs and optimize business performance.
Mega Insurance Records General Insurance Premium Income Growth of Up to 40% in Quarter I-2024
The first quarter of 2024 brought good news for PT Asuransi General Mega (Mega Insurance), with general insurance premium income growing up to 40% on an annual basis (year on year/YoY). President Director of Mega Insurance, Tomy Ferdiansah, revealed that this achievement was thanks to solid collaboration with several multi-finance parties, which caused the multi-finance segment to experience rapid growth and provide a large contribution to general insurance premium income.
“We experienced the most significant increase in the multi-finance segment, which was caused by an increase in Mega Insurance’s market share among our multi-finance partners,” said Tomy to KONTAN on Sunday (14/3).
Apart from focusing on increasing revenue, Mega Insurance is also committed to providing the best service to business partners and customers in every collaboration carried out.
With the various good potential and momentum that exists, Mega Insurance is optimistic that general insurance premium income will continue to increase until the end of 2024. To achieve this optimism, the company will focus on the retail sector, especially in vehicle, travel and property insurance products.
Tomy also emphasized that Mega Insurance continues to strive to innovate and provide the best offers according to market needs, but still pay attention to the principles of prudence and good risk management.
With a premium income target of IDR 1.7 trillion this year, Mega Insurance has shown good performance by recording premium income of IDR 170 billion until February 2024. With the support of the right strategy and strong commitment, the company is optimistic that it can achieve greater success. big for the rest of the year.
OJK Continues to Strengthen the Insurance Industry, Targets PAYDI Product Growth of 5% This Year
The Financial Services Authority (OJK) announced its commitment to strengthening the insurance industry, especially related to increasing capacity and public trust, with a focus on the growth of Investment Linked Insurance Products (PAYDI) or unitlinks throughout 2024.
OJK Chief Executive of Insurance, Guarantee and Pension Fund Supervision, Ogi Prastomiyono, emphasized that these strengthening measures aim to support premium growth for PAYDI products, which is expected to reach 5% this year.
“Strengthening capacity, consumer protection, governance transformation and risk management are the main focuses in OJK’s efforts to restore and increase public confidence in the insurance industry,” said Ogi in a press conference on the Results of the March 2024 OJK Board of Commissioners (DK) Meeting, Tuesday (2 /4).
In 2023, there will be a decrease in premiums for PAYDI or unitlink products, while premiums for traditional products will experience growth of 9.5% Year on Year (YoY) in the same period.
Nevertheless, Ogi expressed optimism that through the strengthening efforts carried out, premium growth for PAYDI products could be accelerated and increased in 2024.
The latest data shows that life insurance premiums as of December 2023 experienced a contraction of 7.99% YoY, but in January 2024 growth was recorded at 8.24% YoY, with a premium value reaching IDR 17.34 trillion.
With ongoing strengthening efforts by the OJK, it is hoped that the insurance industry can face challenges and strengthen its position in providing the best service to the community and increasing public trust.
Source : https://keuangan.kontan.co.id/news/ojk-terus-lakukan-penguatan-kapasitas-industri-asuransi
Energy Insurance Market: Challenges and Opportunities amidst Geopolitical and Economic Instability
The latest report from WTW in its Energy Market Report highlights significant differences in client preferences in the energy insurance market, especially in the context of ongoing geopolitical and economic instability.
While the sector still offers stability, especially for high-end clients, it also poses challenges for those with smaller, less desirable placements.
In the report, it was revealed that insurers are focusing more of their growth ambitions on highly desirable high-end businesses, in response to competitive pressures in the market. However, this has created an increasingly clear divide, increasing the difficulty for less desirable clients to achieve optimal conditions.
WTW Global Head of Natural Resources, Graham Knight, highlighted the widening gap caused by this phenomenon. According to him, this could result in more lenient rate reductions during 2024 for high-end clients, but complicate access to optimal conditions for others.
Despite this, WTW concluded that the energy sector remains stable with no indication that insurers plan to exit this market. The availability of risk and performance data has also steered insurers towards more profitable portfolio segments, although the lack of high-end business relative to demand can force clients to make difficult choices about their market strategies.
OJK notes the limited exposure of financial services institutions to the Middle East region
The Financial Services Authority (OJK) noted that exposure of Financial Services Institutions (LJK) to the Middle East Region is still limited until February 2024, especially in the insurance and financing industry which has securities from Middle Eastern issuers.
According to an official statement released by the Head of the OJK Literacy, Financial Inclusion and Communications Department, Aman Santosa, this exposure is also seen in the domestic banking sector, which only reached IDR 1.3 trillion or 0.06% of the total securities owned by banks.
Meanwhile, in the stock market, the value of share ownership of investors from the Middle East reached around IDR 65.73 trillion or around 2% of the total value of share ownership of non-resident investors. However, LJK ownership by investors in the Middle East is only recorded in banking with an asset share of 0.1% of total banking assets.
OJK ensures that the buffer to maintain financial system stability amidst potential escalation of conflict in the Middle East is still adequate, considering the high level of capital in the region.
Apart from that, OJK assesses that exchange rate risk is well controlled, as can be seen from the daily banking Net Open Position (PDN) which is still far below the set threshold. Liquidity in rupiah and foreign currency is also still considered sufficient.
Nevertheless, OJK continues to pay attention to potential LJK market risks and monitors financing to sectors that have high exposure to conflict in the Middle East. OJK also encourages LJKs to carry out evaluations regarding the potential impacts of global and domestic economic developments and take necessary mitigation steps.
OJK is committed to continuing to coordinate with members of the Financial System Stability Committee (KSSK) and issue the necessary policies in a timely manner to maintain the stability of the national financial services sector.
Parametric Insurance: Innovative Solutions to Protect Farmers and the Indonesian Agricultural Sector
Parametric insurance, different from conventional insurance, is an innovative solution that offers claim payments without looking at the impact of the loss, but based on certain parameters that occur. For example, payments for claims related to earthquakes will be made if the magnitude of the earthquake reaches 8.0 on the Richter scale, or there is extreme rainfall of up to 400 millimeters which results in flooding. In Indonesia, a country that is prone to earthquakes and floods, parametric insurance is a potential solution to protect the public from potential losses due to disasters.
The agricultural sector is the main focus in the use of parametric insurance in Indonesia. With around 58 million hectares of agricultural land owned by individuals, protection against the risk of crop failure and natural disasters is very important. Even though the government has launched a subsidized insurance program for rice farmers through the Rice Farming Business Insurance program (AUTP), the reach of this program is still limited. Only around 0.52% of all agricultural land will be covered by AUTP by the end of 2023. Therefore, innovation in the form of parametric insurance can help expand the reach of insurance protection for farmers.
Various countries have successfully implemented parametric insurance in their agricultural sector. In India, for example, the government provides a 50% premium subsidy for parametric insurance that protects farmers from the risk of crop failure. In Mexico, the government even provides full subsidies for parametric insurance to farmers with incomes of less than US$4 per day. Meanwhile in Japan, parametric insurance is available without subsidies from the government.
To increase parametric insurance penetration in Indonesia, several steps can be taken. First, public education about the benefits of parametric insurance needs to be increased so that people understand the importance of insurance protection. Second, the government needs to provide premium subsidies to reduce the burden on farmers in protecting their assets. Third, cooperation between insurance companies and agribusiness companies can help expand the distribution of parametric insurance products. Fourth, digitizing insurance can make access easier for the public, especially with the high use of smartphones in Indonesia. Fifth, synergy with data providers such as BNPB or BMKG can increase the accuracy of risk calculations.
Parametric insurance has great potential to contribute to increasing insurance penetration in Indonesia, especially in protecting the agricultural sector from the risk of natural disasters. With support from the government, insurance companies and the community, parametric insurance can be an effective instrument in achieving sustainable growth and food security in Indonesia.
This article is brought to you by L&G Insurance Broker, insurance broker Indonesia..
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