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Life insurers expect premium-income growth to hit 25 percent
this year after it continued to perform well through the third quarter
of the year, the industry association says.
Eddy Berutu, executive director of the Indonesian Life Insurance
Association (AAJI), said Wednesday that the industry had booked premium
income of Rp 18.9 trillion (US$2.1 billion) as of the end of September,
marking a 24 percent rise from the Rp 15.3 trillion booked in the same
period last year.
"The fastest growth usually happens during the last two quarters of the
year, due mostly to the year-end sales targets that insurance agents
have to meet," he said.
Regarding claims, he reported that the industry had paid out Rp 10.7
trillion to customers during the first nine months of the year, a 40
percent increase over the Rp 7.6 trillion paid out in the previous year.
The industry's unaudited total assets this year increased more than 20
percent from last year, reaching Rp 64.4 trillion as of the end of
September.
Unit-link products, which combine insurance and investment elements,
remained the most popular products this year, and contributed 29
percent to total premium income. According to Eddy, the popularity of
unit-link products would continue to fuel industry growth in 2007.
These products, which were first introduced to Indonesian insurance
customers in 1993, offer transparency as customers are given freedom in
their investment options, and keep the customers informed about the
details of investment yields.
In line with the growth of the industry, the number of insurance agents
grew by 28 percent to 135,312 as of the end of September from 115,000
during the same period last year.
Indonesia has one of the lowest insurance ratios in the world.
"We have to work harder to communicate the importance of life insurance
to the public," Eddy said.
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