OJK Says Motor Vehicle Premium Reaches IDR 9.39 Trillion Until May 2024

JAKARTA - The Financial Services Authority (OJK) noted that the premium for motorized vehicles until the May 2024 period reached IDR 9.39 trillion, an increase of 5.36 percent year-on-year (YoY), although domestic vehicle sales fell 13.29 percent in the same period.

"In general, motor vehicle premiums are not only sourced from insurance for new vehicles, but also insurance for vehicle ownership that is already running," said OJK's Chief Executive of Insurance, Guarantee and Retirement Fund Ogi Prastomiyono quoting Antara.

Ogi said that OJK encourages insurance companies to innovate and diversify their product offerings to reduce dependence on motor vehicle insurance.

"This can include promotion of use-based insurance, telematics, or other types of insurance products that meet changing consumer needs and behavior," he said.

Specifically for electric vehicles, Ogi said that he supports the industry to be able to develop this insurance more widely in line with OJK's support for sustainable finance initiatives.

He reminded that electric vehicle insurance is also one of the insurance products needed by the community along with the increasing public interest in this type of vehicle.

Ogi said that currently a review of motor vehicle rates is also being discussed and there is an industry desire to separate electric vehicle insurance rates separately.

"This discussion is still ongoing and OJK together with industry will achieve solutions that are beneficial to the wider community," said Ogi.

Previously, at a press conference on the results of the OJK Monthly Board of Commissioners Meeting on Monday (8/7), the OJK reported that the total assets of the insurance industry in May 2024 reached IDR 1,120.57 trillion, an increase of 1.30 percent YoY from the same position in the previous year.

If detailed, total commercial insurance assets reached IDR 900.99 trillion, an increase of 2.10 percent YoY. Commercial insurance performance in the form of premium revenue accumulation rose 8.59 percent YoY, consisting of life insurance premiums growing 2.23 percent and premium general insurance and reinsurance grew 16.94 percent YoY.

On the other hand, non-commercial insurance consisting of BPJS Kesehatan assets (body and national health insurance program) and BPJS Ketenagakerjaan (body, work accident guarantee, death guarantee, or job loss guarantee) as well as ASN, TNI, and Polri insurance programs related to work accident insurance and death insurance programs, total assets recorded at Rp219.58 trillion or contracted 1.86 percent YoY.