Tempo and NatMut join forces

JP/afs

Indonesia's Tempo Group and Australia's National Mutual Group announced yesterday the operation of their joint life insurance venture, PT Tempo National Mutual Life (TNML), with an authorized capital of Rp 30 billion (US$12.48 million).

"The joint venture, with a paid up capital Rp 15.7 billion, is 80 percent owned by National Mutual Group and 20 percent by Tempo Group," TNML's president, Chee Cheong, said yesterday.

The picture shows from left to right, Suyoto, the director for insurances at the ministry of finance, Dian Tamzil, the chairwoman of Tempo Group, Murray Cubban, the deputy head of mission at the Australian embassy, Geoff Webb and Geoff Webb, the managing director of National Mutual International at a reception to launch the insurance company's operation.

TNML was established in 1993 as PT Tempo National Life, a subsidiary of Tempo Group. The Ministry of Finance allowed National Mutul Group to join in the company last January.

The government allows local insurance companies to set up joint ventures with foreign partners two years after starting operation with a minimum capital of Rp 4.5 billion, as compared to Rp 2 billion required for the establishment of a domestic insurance company.

TNML's chief commissioner, Gunawan Sudarmadji, said he was optimistic about the insurance industry in Indonesia because of its big population, expanding middle class, the sustainability of its economic growth and an increase in awareness of insurance.

Chee said the current ratio of policy holders to per capita gross domestic product was still very low at 0.5 percent. The ratio in ASEAN is 1.3 percent.

The ratio in the Organization for Economics Corporation and Development is 5 percent.

"We expect to make profit in seven years," he said.

TNML lost Rp 2.12 billion in 1994 and another Rp 2.39 billion in 1995. (10)