More companies turn to insurance firms to handle workers' health
More companies turn to insurance firms to handle workers' health
Sudibyo M. Wiradji, Contributor, Jakarta
Although there is little public awareness of the need of
insurance benefits, many life insurance companies are
experiencing a growing demand from corporate clients.
Among the popular insurance services offered to companies
include life insurance, health insurance and pension plans.
The insurance program a corporate client takes usually depends
on the results of negotiations between the employer and
representatives of the insurance provider.
Insurance firms offer their products based on the companies'
needs in relation to their employees' welfare. Each insurance
provider has its own terms and conditions such as the minimum
number of employees needed to ensure eligibility for
participation in the program. But on average the number of
employees should at least 25 for outpatient insurance and 10
employees for an inpatient insurance package.
Particular insurance providers also include age in the terms.
At PT Asuransi Jiwa Central Asia Raya, for instance, the minimum
age is set at 15 years old and the maximum age is 25 years old.
The insurance providers will issue participant cards,
depending on what service a company takes, which employees of
participating company can use when needed. Commonly, the card
issuance takes between seven days and 14 days after the required
paperwork is completed.
When a participant or his or her family member falls ill and
has to be hospitalized, he or she is free to select the appointed
hospital, commonly one close to his or her home. The insurance
provider will cover all costs for medical treatment.
The amount of premium a company should pay per year depends on
the health insurance scheme selected. The minimum premium for
inpatient insurance package set by PT Asuransi Jiwa Manulife
Indonesia, for instance, is Rp 15 million (about US$ 1,600) per
year.
"The premium can be paid once or in two lots," said the
company's assistant vice president Cynthia Bondad, adding that
companies that participate in outpatient insurance are also
required to pay the premium but the amount is less than Rp 15
million.
Some health insurance products also offer a reimbursement
system under which the participant will have to pay the medical
expenses first and the insurance provider through the employer
will reimburse later. Commonly, the reimbursement period will
take two weeks at the maximum.
In addition to health and life insurance products, companies'
interest in pension plans is also on the rise. Unlike life or
health insurance products that are mostly based on a policy set
by the respective insurance providers, the pension program should
be in compliance with the pension law.
For example, based on the Pension Law No. 11, 1992, the
maximum contribution that must be paid by an employee should not
exceed 20 percent of his or her salary. Also, according to the
pension law, the pension benefit is payable when the participant
reaches his or her Normal Pension Age (NPA) determined by the
employer between the range of 50 years to 65 years of age. And if
a participant retires early, the pension benefit is payable at
least 10 years before he or she reaches the normal pension age
determined by the employer, except if the employee dies while
still in the employ of the company. In this case the total amount
of accumulated pension is less than Rp 50 million, the payment
should be made directly to the beneficiary.
The participants will usually receive a report on their
accounts once every six months.
Insurance providers offering life, health and pension plans
include PT Asuransi Jiwa Central Asia Raya (CAR), PT Asuransi
Jiwa Manulife Indonesia (AJMI), PT Asuransi Allianz Life
Indonesia and PT ING Aetna Life Insurance. PT Asuransi Jiwa John
Hancock Indonesia focuses on providing pension plan service.
The health insurance programs offered by PT CAR to corporate
clients include Prevensia, which contains inpatient, outpatient,
dental treatment, maternity and glasses with a minimum of 250
participants.
"For life insurance, we have Personal Accident (PA) and Term
Life," said CAR's Director Hero Samodra.
The number of companies participating in CAR's insurance
programs continues to increase, mostly coming from manufacturing
companies.
CAR also provide pension plan. "Our pension program is defined
contribution. Every member or participant is free to decide the
contribution but it should be at least 10 percent of their
salary," he said.
PT Asuransi Jiwa Manulife Indonesia (AJMI) offers insurance
programs for corporate customers to provide a "sense of security"
for employees.
Types of programs offered include Term Life Insurance,
Accidental Insurance, Total Permanent, Disability Insurance,
Hospital and Surgical Insurance, Outpatient Insurance, Dental
Insurance, Optical Insurance and Maternity Insurance.
PT AJMI's pension programs are managed by Dana Pension Lembaga
Keuangan (DPLK) Manulife Indonesia.
Cynthia said the minimum premium for corporate clients is Rp 1
million per company. "It is up to the company how many members
participate in the pension plan," she said.
In the area of pension programs, the company has come up with
several innovative packages that also provide customers with
investment benefits.
"We have carefully designed our investment options to maximize
the return for each participant while minimizing the underlying
risk," she said.
The DPLK Manulife Indonesia offers five investment funds
ranging from low risk with potentially lower return funds to high
risk with potentially higher return funds.