AIA expects higher premium income in 2000

JAKARTA (JP): Insurance company PT Asuransi AIA Indonesia expects a 30 percent to 35 percent increase in total premium income in 2000 from Rp 178.94 billion ($21 million) achieved in 1999 through the opening of 10 new sales offices later this year.

Outgoing general manager and director Mark S. O'Dell said on Wednesday that the new offices in Sumatra, Java, Bali, Sulawesi, and Kalimantan, were part of an expansion plan made by the company since the beginning of the economic crisis in 1997.

"The crisis did not deter our plan for expansion," he said.

AIA Indonesia, a subsidiary of the American International Assurance Co. Ltd, has opened 32 new sales offices in Indonesia since July 1997.

The company, which became the first multinational insurance company in 1975, is currently represented by 2,500 agents.

The company's risk based capital of 209 percent at the end of March was one of the strongest in the industry, said O'Dell.

This is well above the 5 percent minimum required by the Ministry of Finance and the 100-120 percent minimum international standard, he said.

"This strong position is the result of a successful investment strategy achieved in conjunction with capital security," he said.

O'Dell will soon transfer to Malaysia and his post in Indonesia will be filled by Chris Lossin from AIA in Hong Kong.

AIA Indonesia saw an increase in premium income in 1999 to Rp 178.94 billion from Rp 118.5 billion in 1998.

It forecast a 240 percent increase in new premiums and hope to achieve a further 50 percent increase this year, Mark said.

AIA earned Rp 22.7 billion ($2.67 million) net profit in 1999, down from Rp 29.9 billion ($3.51 million) in 1998.

AIA launched on Wednesday a comprehensive life insurance package called Peduli, vice president chief actuary and director of operations Angger P. Yuwono said.

The product gives the benefit of free premium payments if the holder suffers permanent disability from an accident, and a benefit upon the death of a spouse, Angger said.

AIA expects to achieve some 2,000 new policies from this product this year, he said. (10)