Liga Asuransi – As the homecoming season approaches and the long holidays are approaching, travel protection is an aspect that should not be ignored. Travel risks, ranging from delays, lost luggage, to accidents, can occur at any time. Therefore, having travel insurance is not just an option, but a necessity to ensure a safe and comfortable trip. On the other hand, the insurance industry in Indonesia also continues to develop with various innovations, including the rapid growth of sharia insurance and the latest policies from the Financial Services Authority (OJK) which have the potential to influence health insurance premiums. Check out the complete review in the following summary of the latest insurance news!
Sharia Insurance Explodes! Trends & Innovations That Will Change the Financial Industry in Indonesia
The sharia insurance industry in Indonesia continues to experience rapid growth in the last decade. Increasing public awareness of sharia-based finance, supported by increasingly conducive regulations, has opened up great opportunities for this sector. With the largest Muslim population in the world, sharia insurance has tremendous potential to expand access to more inclusive financial services.
Based on the latest data from the Financial Services Authority (OJK) as of December 2024, the sharia life insurance industry experienced an increase in assets of 4% compared to the previous year. In addition, the number of full-fledged sharia insurance companies has continued to increase in the last two years, indicating increasing interest in sharia-based financial products. The main factor behind this growth is the increasing demand for sharia insurance products and innovations that continue to be developed to meet market needs.
Challenge: Medical Inflation and Public Purchasing Power
Despite experiencing positive growth, this industry still faces various challenges. Post-pandemic economic conditions, declining people’s purchasing power, and surging medical inflation are the main factors that need to be addressed. It is estimated that in 2025, medical inflation will soar to 19%, much higher than general inflation which is only 2.6%. This increase in health care costs has the potential to increase the number of health insurance claims, even outstripping the growth in premiums collected by the industry.
Opportunities and Innovation: Sharia Health Insurance Becomes the Favorite
Responding to this challenge, Prudential Syariah sees great opportunities in the growth of sharia health insurance. In an event Insurance Forum 2025, President Director of Prudential Syariah, Iskandar Ezzahuddin, revealed that demand for health insurance has increased sharply since the COVID-19 pandemic. According to him, even though the level of insurance penetration in Indonesia is still low, this actually opens up big opportunities for sharia health insurance products to develop.
Apart from that, the public consumption trend which is increasingly leaning towards sharia-based products, such as food, fashion, cosmetics and banking, also strengthens the bright prospects for this industry. “We are optimistic that sharia health insurance will become a rapidly growing segment in Indonesia,” said Iskandar.
In response to rising medical costs and people’s limited purchasing power, Prudential Syariah continues to innovate by presenting simpler and more affordable insurance products. One of their latest innovations is PRUWell Medical Syariah, which offers a fairer pricing system (fair pricing) with lighter contributions and additional benefits for participants who take care of their health.
Multisector Collaboration: Key to Sharia Insurance Growth
The growth of the sharia insurance industry depends not only on product innovation, but also on synergy between regulators, the financial industry and other stakeholders. The Financial Services Authority (OJK) is currently collaborating with the Indonesian Ministry of Health to build a better health insurance ecosystem. Chief Executive of the OJK Insurance, Guarantee and Pension Fund Supervisor, Ogi Prastomiyono, stated that this step aims to increase public access to health insurance and strengthen coordination with BPJS Health and other health facilities.
Iskandar Ezzahuddin welcomed the OJK initiative, while emphasizing that appropriate regulations could open up more innovation opportunities for this industry. “We are committed to continuing to provide health solutions that are not only innovative, but also suit the needs of sharia insurance participants,” he said.
The Indonesian Insurance Council also emphasized the importance of cross-sector collaboration in creating a sustainable insurance ecosystem. Apart from involving regulators and insurance companies, synergy with the government and other industry players is key in ensuring that sharia insurance products are increasingly accepted by the wider community.
Building a Better Healthcare Ecosystem
As part of efforts to strengthen the health service ecosystem, Prudential Syariah has established partnerships with various hospitals through programs PRUPriority Hospitals. Currently, they have collaborated with more than 400 hospitals in various countries, including 36 government hospitals in Indonesia, to ensure insurance participants receive quality medical services.
Apart from that, Prudential Syariah also presents a virtual mentoring service called PRUCare Advisor. This service provides various additional benefits, such as consultations with global specialist doctors, appropriate treatment recommendations, and assistance in recovering health after hospital treatment. This service is available to participants with certain packages and products at no additional cost.
“Prudential Syariah is always open to collaboration that can create a better health service ecosystem. With solid cooperation between various sectors, we hope to present innovations and policies that not only maintain economic sustainability, but also improve access and quality of health services for all Indonesian people,” concluded Iskandar.
With promising growth, continuing innovation, and support from regulators and other stakeholders, the future of the sharia insurance industry in Indonesia looks increasingly bright. People now have more options to obtain sharia-based protection that complies with Islamic financial principles, while ensuring their financial peace of mind in the future.
OJK Requires Coordination of Benefits in Health Insurance, Could Premiums Become More Expensive?
The Financial Services Authority (OJK) is currently finalizing the Draft OJK Circular Letter (RSEOJK) concerning the Implementation of Health Insurance Products, one of the main points of which is to require a Coordination on Benefits (CoB) feature in every health insurance product.
Executive Director of the Indonesian General Insurance Association (AAUI), Cipto Hartono, stated that this draft will be ratified in the near future and the provisions of the CoB are unlikely to change. “In the RSEOJK which will soon be published, it seems that there will be provisions that stipulate that health insurance products must have a benefits coordination feature with BPJS Health,” said Cipto to Bisnis, Wednesday (19/3/2025).
Greater Claim Burden on Private Insurance Parties
In the CoB scheme, private insurance companies are required to bear a larger portion of the claim burden compared to BPJS Health. This raises the question of whether health insurance premiums will increase as a result of this policy.
Cipto explained that even though there is this obligation, insurance premiums do not immediately increase significantly because premium prices are influenced by various other factors. “Regarding the impact on premiums, basically business will continue to run as it should. Health insurance premiums are not only determined by the CoB scheme, but are also influenced by factors such as the insured’s claim history, inflation trends in medical costs, as well as the benefit structure in the policy, including benefit coverage and maximum coverage limits,” he explained.
Furthermore, he added that even though private insurance companies bear a greater burden, regulations still limit the rates that can be charged by hospitals to a maximum of 200% of the INA-CBG (Indonesian-Case Based Groups) rates. The INA-CBG tariff itself is a BPJS Health claims payment system based on the grouping of disease diagnoses and medical procedures, which is regulated in Minister of Health Regulation No. 3 of 2023.
Potential Premium Increase Can’t Be Avoided?
Meanwhile, Chairman of the Product, Risk Management and GCG Division of the Indonesian Life Insurance Association (AAJI), Fauzi Arfan, believes that the CoB policy could lead to an increase in premiums. “If the CoB scheme requires private insurance to cover a larger cost difference, then there is the potential for product premiums with the CoB feature to be higher than products that do not adopt this mechanism,” he explained.
According to him, each insurance company has a different pricing strategy, but with the increasing claim burden, evaluation of the CoB scheme must be carried out periodically. “The ever-changing dynamics of health costs must be a consideration in sharing the burden between private insurance and BPJS Health,” he added.
Need Evaluation and Flexible Strategy
Insurance industry players emphasize the importance of evaluating the CoB scheme to ensure a balance between benefits for participants and the sustainability of the insurance business. With health costs continuing to increase, insurance companies need to develop flexible strategies in determining premium prices so that they remain competitive and affordable for the public.
Will this policy cause health insurance premiums to increase drastically? Only time will tell, but one thing is certain: benefit coordination in health insurance will be a major concern for the industry and society going forward.
Disappointed Customer! OJK Files Cassation, Is the Fate of Funds in Kresna Life Insurance Threatened?
Hundreds of Kresna Life Insurance (AJK) customers expressed their disappointment with the steps taken by the Financial Services Authority (OJK) to submit an appeal to the Supreme Court regarding the decision of the State Administrative Court (PTUN). The policy holders hope that the panel of judges will reject the OJK’s legal action seeking to defend the revocation of AJK’s business license.
One of the customers, Lichu, submitted his request to the supreme judge to reject the cassation submitted by the OJK. According to him, as many as 97 percent of the total 6,000 Kresna Life Insurance customers want the company’s operations to continue to run to ensure debt payments to customers can be made.
“Kresna Life Insurance has paid IDR 1.4 trillion and still has a remaining obligation of IDR 5 trillion which is scheduled to be paid off in the next five years,” said Lichu.
Meanwhile, the customer’s attorney, Benny Wullur, regretted OJK’s steps which were deemed not in favor of the interests of policy holders. According to him, the decision to revoke the permit actually hampers the company’s fulfillment of its obligations to customers.
“The OJK as a state institution should protect the public and find the best solution. In fact, AJK management and its customers have reached a peace agreement, but it is the OJK that insists on revoking the permit. If the permit is revoked, where will the company be able to pay its debts?” said Benny, Wednesday (19/3/2025).
With the ongoing polemic, customers hope that the Supreme Court can consider their condition and decide on the best steps for justice and legal certainty.
Safe and Comfortable Homecoming! Don’t underestimate travel insurance, here are the benefits
As the Eid homecoming season approaches, millions of travelers are preparing to travel long distances to be with their families. However, amidst the enthusiasm for welcoming the holidays, there are still many people who do not realize the importance of having travel insurance to protect themselves from various risks while traveling.
According to insurance observer Irvan Rahardjo, protection from travel insurance is very broad. Apart from providing medical coverage, this insurance also includes compensation for policy holders who experience temporary or permanent disability, as well as compensation for death due to an accident while traveling. Not only that, this protection also includes compensation for lost baggage and reimbursement of ticket and accommodation costs if transportation delays occur.
“Travel insurance can be purchased individually directly through an insurance company, either through digital platforms such as websites or social media. The price is quite affordable, because this policy is valid only for the duration of the trip, namely from departure to return. The cost is around 0.2% of the total trip cost,” explained Irvan when interviewed by Kontan, Thursday (20/3).
Unfortunately, even though it has quite extensive benefits, public awareness of the importance of travel insurance is still relatively low. The lack of education and lack of outreach from the insurance industry are the main factors in the low demand for this product.
Apart from that, the downward trend in the number of travelers this year is also expected to have an impact on reduced interest in travel insurance. The weakening public purchasing power also affects the insurance sector as a whole.
Under these conditions, insurance industry players are expected to be more active in educating the public about the importance of travel protection, especially in dealing with various risks that may occur during the Eid homecoming. By understanding the benefits, people can enjoy traveling more safely and calmly without worrying about unexpected things.
Insurance Industry Welcomes Golden Opportunity! Is Bullion Business Protection Increasingly Attention?
PT Asuransi Cakrawala Proteksi Indonesia (ACPI) sees a big opportunity in the involvement of the insurance industry in the bullion business or gold trading in Indonesia. ACPI Deputy President Director, Nicolaus Prawiro, stated that insurance protection for bullion businesses is nothing new in the industry, considering that there are Cash in Safe (CIS) and Cash in Transit (CIT) insurance products that are already available.
“This is a good opportunity for the insurance industry because it can increase premium income, although the impact is not very significant,” said Nicolaus to Bisnis.com, Thursday (20/3/2025).
Furthermore, ACPI has collaborated with several banks to provide protection in the form of CIS and CIT. In fact, ACPI has a good track record in providing insurance protection for gold companies in Indonesia.
“We already have extensive experience in insurance protection for gold in several companies. However, overall the contribution of CIS and CIT insurance products to our total premium is still relatively small,” he explained.
As a country with one of the largest gold reserves in the world, Indonesia is relatively late in developing the bullion industry. It was only this year that the government officially permitted bullion business activities, with only two Financial Services Institution (PJK) companies obtaining operating permits.
Even so, public awareness of gold investment is quite high, even though it is still done conventionally. Nicolaus believes that with government support, the prospects for gold investment in Indonesia will further develop, as well as becoming a positive catalyst for the insurance industry.
“The existence of bullion banks allows people to invest in gold in a more modern way. I believe this will provide positive sentiment for the insurance industry, although the impact on premiums is still limited,” he added.
For your information, insurance protection for stored gold (CIS) and gold travel protection (CIT) are part of the miscellaneous insurance business line. Throughout 2024, premiums from miscellaneous insurance will grow 3.9% on an annual basis (YoY) to IDR 4.25 trillion, compared to IDR 4.11 trillion at the end of 2023. Despite the growth, the market share of the miscellaneous insurance business line is still small, only 4% of the total premium earned by the general insurance industry which will reach IDR 112.86 trillion in 2024.
With increasing gold trading activities and regulatory support, opportunities for the insurance industry to increase involvement in the bullion business are increasingly wide open. Now, the main challenge is how the insurance industry can be more active in educating and offering products that suit the needs of the gold market in Indonesia.
Private Insurance Subject to a Greater Burden in the CoB Scheme? Here’s How to Control It!
The Indonesian General Insurance Association (AAUI) ensures that private insurance companies can still manage claims costs effectively, even though in the Coordination on Benefits (CoB) scheme with BPJS Health they have to bear a greater burden.
AAUI Executive Director, Cipto Hartono, explained that burden sharing in the CoB scheme has been regulated in the Decree of the Minister of Health (KMK) HK.01.07/Menkes/1366/2024. In this regulation, BPJS Health covers 75% of the INA-CBG tariff according to the participant’s treatment class, while private insurance covers the cost difference up to a maximum of 125% of the INA-CBG tariff.
Cost Limits Still Under Control
Cipto emphasized that as long as the total costs covered do not exceed 200% of the INA-CBG tariff, the private insurance burden is still within reasonable limits and can be controlled. “With this limitation, private insurance companies still have room to manage claim costs efficiently,” said Cipto in an interview with Bisnis, Wednesday (19/3/2025).
Even though the claim burden is increasing, the claim ratio for general health insurance is still more controllable compared to life insurance. Until the end of 2024, the ratio of general insurance health claims will be at 58.2%, even improving from the previous year which reached 95.3%. In comparison, the health claims ratio in the life insurance sector has exceeded 100%.
Claim Expense Control Strategy
To keep claims ratios healthy and prevent uncontrolled cost spikes, general insurance companies implement a number of cost management strategies, including:
- Monitoring Claim Patterns – Closely monitor healthcare usage trends to identify potential risks and abuse of insurance benefits.
- Utilization Review (UR) – Review the effectiveness and efficiency of health services to ensure claims submitted are appropriate to medical needs.
- Strengthening Collaboration with Providers – Establish stricter cooperation agreements (PKS) with health service providers to control service costs.
- Education for the Insured – Increase participants’ understanding of optimal use of insurance to avoid misuse of medical services.
For information, the INA-CBG (Indonesian-Case Based Groups) tariff is a claim payment scheme determined by BPJS Health based on the grouping of disease diagnoses and certain medical procedures. This rate is regulated in Minister of Health Regulation Number 3 of 2023.
With the right strategy, private insurance companies can still run their business efficiently without having to charge too high premiums to participants. The CoB scheme with BPJS Health does add challenges, but with good mitigation measures, the private insurance industry still has the opportunity to continue to grow and develop.
The Indonesian insurance industry is asked to grow 8% per year, but why is inclusion still low?
The insurance industry in Indonesia has received a growth target of 6-8% per year from the Financial Services Authority (OJK). General Chair of the Indonesian Insurance Council (DAI), Yulius Billy Bhayangkara, said that the current insurance industry premium growth has even reached 9.9% per year, with equity growing 8.1% and liabilities increasing 6.1% per year.
“Ideally, the amount of existing equity is able to cover all risks as liabilities. From this growth data, we are on a good track, and it is important for us to maintain this position,” said Yulius at the Public Hearing Meeting (RDPU) of Commission XI DPR RI, Monday (17/3/2025).
Literacy is High, But Interest in Buying Insurance is Still Low
Even though the industry shows positive growth, the level of insurance literacy and inclusion in Indonesia is still far from expectations. Based on OJK data presented by Yulius, the insurance literacy rate in Indonesia is currently at 44%, while the inclusion rate is only around 12-13%.
“This shows that even though many people understand insurance, they don’t necessarily buy it. Only about half of those who understand actually have insurance,” emphasized Yulius.
People are not aware that they already have insurance
One phenomenon that occurs in Indonesia is that many people actually already have insurance protection but are not aware of it or do not use it optimally. For example, BPJS Health has covered almost 98% of the population, but there are still many participants who do not know how to use its benefits properly. The same thing also happens with vehicle insurance which is automatically obtained when purchasing a vehicle through leasing.
According to Yulius, there are three main reasons someone buys insurance. First, because of regulations, such as BPJS Health which are required by law. Second, because of certain contracts, such as vehicle insurance in a leasing scheme. Third, due to personal awareness of managing financial risks, such as protecting assets and preparing for old age.
OJK and Insurance Industry Synergize for Education
Seeing the low level of insurance inclusion, Yulius emphasized the importance of more massive education so that people not only understand insurance, but are also encouraged to have it. OJK is also committed to increasing insurance literacy and inclusion by collaborating with industry players.
“OJK will help and collaborate with us in increasing insurance literacy, so that people not only understand but are also encouraged to have protection that suits their needs,” concluded Yulius.
With stable industry growth but still low levels of inclusion, a big challenge for insurance industry players is how to increase public awareness so that they can truly utilize this financial protection optimally.
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