Medical Costs Surge 17.9 Per Cent, Families Need Strategy to Protect Finances

Amid rising living costs and economic pressure, Indonesian families face the challenge of maintaining financial stability. One of the most significant factors affecting household budgets is rapidly escalating healthcare costs. Without proper preparation, medical expenses can erode savings and disrupt long-term financial planning.

This surge in medical costs is reflected in the Health Trends 2026 report released by Mercer Marsh Benefits, which notes that Indonesia’s medical trend rate reached 17.9 per cent in 2025 and is projected at 17.8 per cent in 2026. This figure far exceeds the national general inflation projection of between 1.5 and 3.5 per cent for the same period, according to Bank Indonesia’s target. This sharp disparity adds pressure to household expenditure and underscores the importance of financial protection strategies, including health insurance and life benefits.

In this regard, PT MSIG Life Insurance Indonesia Tbk (MSIG Life) paid out health claims and death benefits totalling Rp1.07 trillion throughout 2025. These claims cover medical treatment costs for policyholders facing health risks and benefits for families who have lost a breadwinner.

“Claim payments are a tangible manifestation of our protection commitment. Maintaining family financial resilience can only be achieved consistently if supported by the company’s healthy and strong financial condition,” said Ken Terada, Director and Chief Transformation Officer of MSIG Life, as quoted from a press release on Monday, 2 March 2026.

The company’s financial strength is reflected in MSIG Life’s Risk-Based Capital (RBC) ratio of 1,381 per cent at the end of 2025, far exceeding the Financial Services Authority’s (OJK) minimum requirement of 120 per cent. As part of the MS&AD Insurance Group of Japan, the company applies global risk management standards that ensure disciplined governance and the ability to meet long-term obligations.

Ken Terada emphasised that insurance is not merely about paying claims, but ensuring family financial resilience remains protected. “Each claim we pay represents one family facing an important phase of their lives, whether undergoing healthcare treatment or losing a breadwinner,” he said. “Our task is to ensure protection truly materialises, so families maintain financial resilience and can move forward with greater confidence.”