Public has yet to place a premium on insurance

JAKARTA (JP): The political climate is heating up as organizations ready themselves for the June 7 general election. As Indonesia nurses its remaining wounds from the devastating riots last May, people are worried similar unrest will erupt before, during or after the much-awaited election.

Insurance companies apparently consider the public unease as an opportunity to rake in profits. Some have aggressively advertised their services.

Yet many Indonesians are unfamiliar with the insurance system. The Jakarta Post interviewed people of different backgrounds to find out their take on insurance.

Gunawan Lesmana, finance and accounting manager at a private firm: I insure my 1992 Suzuki Esteem which is valued at about Rp 35 million by the insurance company. My company pays some of the premium as it also pays for the gas. It's part of the package.

The premium for the car insurance is 3 percent annually, but we receive a 30 percent corporate discount on that. This, plus the 1 percent rate for riot coverage, totals about Rp 700,000 a year.

Having my car insured is a big convenience for me. Recently, my car was hit from behind at a red light by a car full of teenagers. The impact was so hard my car's dashboard came off.

There was no way to get the driver of the car to pay for my car's damage, and the driver even tried to extort money from me. But my insurance covered the accident and within a few days I got my car back, fixed already.

Agung Laksono, state minister of youth affairs and sports: Everybody should retain the freedom to decide whether they will insure their property.

When we purchase a car, we are always offered insurance. The most important thing is that there is no coercion involved.

Risk insurance is a business opportunity. Those with a sharp sense of business will see an opportunity in every problem.

They can just make the best of it, but they should not coerce customers into buying their products, or assume that insurance is the answer to all problems. It only serves as an alternative to solve the problems.

I am a customer of a life insurance company because I believe that we should be prepared in the event something happens. It is not because I fear unrest that could result in the loss of property.

Agus Purwadianto, chairman of the Jakarta chapter of the Indonesian Medical Association: My two cars are not insured. So far, everything is all right. And I have no intention to insure them despite the prospect of violence in the upcoming elections.

In my opinion, we have to be really careful before deciding to insure our belongings. We should not sign up for an insurance program simply because of its aggressive advertisements.

Personally, I do not really trust insurance companies. I will not join an insurance scheme unless I really know the person in charge. If I cannot trust the person, it's the same as buying a pig in a poke.

I think none of the insurance companies will really be able to cover everything. How can they provide good services if their own business is badly affected by the crisis?

Noviyanti Wongkaren, a housewife with two children: My husband and I spend a lot of money on insurance.

Aside from life and health insurance for the whole family, I insure my house and two cars, a Toyota Kijang and an Isuzu Panther. My husband's car is a bit old so it can't be insured.

The Panther and Kijang are valued at about Rp 97 million each, so we pay almost Rp 4 million for each car per year. It's the all-risk insurance policy of Gardaoto; the coverage extends to riots and other civil unrest.

We are compensated for anything that happens to the car and the driver, from a scratch, stolen CD player, to major accidents involving injury.

I was in an accident recently and everything was fixed within three days, we even got new tire rims.

The car insurance premiums are costly compared to the house insurance. We live in a peaceful residential area so the premium isn't that much.

I appraised the house at about Rp 200 million, and the furniture and interior items at Rp 60 million, although they really cost more than that.

We formerly paid about Rp 800,000 annually for the house insurance; now it has been increased to about Rp 900,000 per year.

Didi Petet, noted actor: I have insured my car since last year because I was obliged to do so when I bought the car. But I haven't had to use it. There's nothing happening. Hope nothing will.

I don't remember how much I pay for my annual insurance payment. But it feels like I'm wasting my money on it. Like saving money for nothing. I don't know.

My car insurance does not cover riots, it's just a regular car insurance policy. And I have no plan to add riot coverage just because of the upcoming general election. I also do not know whether I will keep insuring my car.

Christina Rini, a lawyer at the Jakarta Legal Aid Institute: I decided not to insure my Kijang van since the premium increased from Rp 2.2 million last year to Rp 5.5 million this year.

It's a pity. Actually, I want to participate in an insurance scheme because I'm worried about possible riots in the general election, but then I said forget it because I could not pay the premium.

Consequently, I rarely use my car for fear of accidents.

I joined insurance firm Asuransi Astra Buana last year. During the insurance term, my van was hit by a motorcycle in Yogyakarta. My van's body was damaged.

I returned to Jakarta and visited the firm. I was then asked to take my van to the Auto 200 workshop.

Repairs cost Rp 1.8 million. I only paid Rp 100,000 while the remainder was financed by the insurance firm.

Tondo Widodo, director of PT Merpati Nusantara Airlines and spokesman of the All-Indonesian Soccer League: Usually companies are responsible for any risks which accompany the purchase of property like car and houses. I think such insurance is important because the businessman shares the risk with customers.

Insurance is very useful but not many people are aware of that fact. I insure my car only because the dealer asked me to do so when I purchased it.

I realize that if we want to live peacefully we will have to spend more for insurance. In developed countries in Europe and United States, insurance has become a mainstay.

Sinano, a reporter of Bisnis Indonesia daily: I joined insurance firm Asuransi Danamon. I paid a Rp 3 million premium for my Suzuki Baleno sedan two years ago.

My car was once hit by a van in the parking lot of my office in Slipi area, West Jakarta. Its front bumper was damaged.

The insurance firm asked me to use its affiliated car shop. It needed Rp 1.8 million for the repair and I spent nothing.

I take all-risk insurance which is valid until next year. It's important this time when riots could happen anytime.

Muksin, an auto repair shop manager on Jl. Radio Dalam in South Jakarta: Having risk insurance helps me sleep better at night.

It is too risky for us if we do not have risk insurance because we run a multimillion rupiah business. We insured the shop years before the May riots.

Thank God, we were not affected by the riots but my friends who run spare parts shops in (nearby) Cipete Market were not as fortunate.

A number of them had not insured their businesses when they were looted or set on fire, and now they realize how important the risk insurance is.

I think it is better to spend hundreds of thousands of rupiah on risk insurance than lose your whole business.

Ngadimin, security guard at the National Sports Council office: I wish I could join any insurance company because as far as I know the insurance could improve our welfare, but the thing is I cannot afford to pay for the premium.

I prioritize the education of my two children who are university students. (jun/ste/ivy/das/byg)