BNI sets up insurance company

JAKARTA (JP): Publicly listed Bank Negara Indonesia (BNI) has established a life insurance company in cooperation with its pension fund and the employees' welfare foundation of the state- owned life insurance company Jiwasraya.

BNI announced yesterday a 60 percent stake in the insurance company, which has a paid-in capital of Rp 15 billion (US$5 million).

Its partners, Jiwasraya's employees' foundation Yayasan Kesejahteraan Karyawan has a 30 percent stake while BNI's pension fund holds the remaining 10 percent in the new insurance company called PT Asuransi BNI Jiwasraya (BNI Life).

President of the new insurance company, Ubung Bachtiar, said BNI Life was founded in November, 1996 but was only licensed to operate by the Ministry of Finance in July this year.

"Our main market target is BNI's debtors, BNI's subsidiaries as well as its pension fund's subsidiaries," Bachtiar said during a ceremony to sign a reassurance agreement between BNI Life and PT Reasuransi International Indonesia.

He said BNI Life would cover all BNI borrowers' credit as part of the lending contract with creditors.

"Customers need not pay the premium themselves because BNI will do that on their behalf," he said, adding the bank increased its lending rate to cover the premium.

He said although BNI Life had been given the right to cover BNI clients' credit, it would provide its costumers with good service.

Bachtiar said the company currently focused on costumers in the greater Jakarta area because it lacked the technological resources to set up online connections to all BNI offices throughout the country.

"I hope next month we'll finish installing all the equipment," Bachtiar said, adding that about 2,500 BNI Life customers lived in the greater Jakarta area.

Bachtiar refused to target customers, but said all BNI debtors, which included 130,000 people, were potential clients. (jsk)