Life insurers report 33.5% growth in their revenues

Life insurers report 33.5% growth in their revenues

JAKARTA (JP): The Indonesian Insurance Council (DAI) yesterday
reported a 33.5 percent increase in revenues from the life
insurance sector, rising to Rp 1.28 trillion (US$592.21 million)
last year from Rp 963.15 billion in 1992.

"Of last year's total revenues, Rp 1.04 trillion came from
life insurance premiums," DAI's vice chairman for life insurance
affairs, Sujono Soepeno, told reporters here yesterday.

He said that last year's premium revenues reflected a 36.3
percent increase from Rp 766.98 billion in 1992.

Sujono revealed the information at the launching of DAI's 1993
report on the country's life insurance industry, held at the Le
Meridien Hotel.

Based on the report, PT Bumiputera 1912, Jiwasraya and
Dharmala Manulife were the biggest premium earners last year with
their revenues reaching Rp 416.40 billion, Rp 166.82 billion and
Rp 74.94 billion, respectively, he said.

Sujono, who is also the president of PT Panin Life, said that
life insurers' revenues from investments increased to Rp 200.63
billion last year from Rp 182.34 billion a year earlier.

Jiwasraya last year recorded the highest revenues in the
insurance sector with Rp 67.44 billion, followed by Panin Life
with Rp 35.38 billion and Bumiputera 1912 with Rp 31.83 billion,
he added.

He pointed out that the fine performance of life insurance
revenues was partly due to the increase in the number of policy
holders in the country.

He noted that the number of life insurance policy holders last
year increased to 14.94 million insured for Rp 31.64 trillion,
from 13.52 million with Rp 26.10 trillion in 1992.

He said that policy holders as a percentage of the country's
population increased to eight percent last year from 7.3 percent
in 1992.

An informed source told The Jakarta Post recently that the
insurance policy holders as a percentage of the population was 35
percent in Singapore, 40 percent in the Philippines, 20 percent
in Malaysia and 30 percent in Thailand.

Penetration

Sujono said that in terms of insurance penetration, which is a
statistic expressing premiums as a percentage of the gross
domestic product (GDP), premium payments in Indonesia reached
only 0.4 percent last year, as compared to 9.8 percent in South
Korea, 6.3 percent in Japan, 2.3 percent in Singapore, 1.7
percent in Malaysia and 1.4 percent in the Philippines.

However, he said that he was optimistic that the Indonesian
life insurance industry had a bright future due to the increasing
number of policy holders.

Sophar L. Toruan, director of the insurance industry of the
Ministry of Finance, attended yesterday's launching ceremony and
expressed his optimism that the number of premium holders would
rise by 20 percent in Indonesia in the coming years. He said his
estimate was based on the fact that there are still around 35
million workers in the country who were not covered by insurance.

However, he also said that the lack of professionalism in
managing the insurance industry was the main problem faced by the
country's insurers.

"Some insurers, for example, still take two or three months
before paying insurance claims. This will discourage policy
holders," he said.

Sophar said there are now 148 insurance companies in the
country, comprising of 46 life insurance firms, 98 loss insurers
and four reinsurers. (fhp)