OJK Records Insurance Premium Revenue Drops 1.33 Percent Reaches IDR 78.5 Trillion

Rupiah (Photo: Doc. Antara)

JAKARTA - The Financial Services Authority (OJK) noted that premium income for the insurance sector during the period January to March 2023 reached IDR 78.50 trillion.

The premium income contracted by 1.33 percent compared to the same period in the previous year.

"At the same time, the accumulation of life insurance premiums contracted 9.81 percent, with a value of Rp44.84 trillion as of March 2023, driven by a decrease in premiums in PAYDI's (Investment-linked Insurance Product) business lines," said the Chief Executive of Insurance Supervisory, Financial Services Authority (OJK) Guarantee Institution and Retirement Fund Ogi Prastomiyono quoting Antara.

However, the accumulation of general insurance premiums still grew positively by 12.87 percent on an annual basis to Rp33.66 trillion.

"Normalization of the premium growth performance of the PAYDI business line has been anticipated by the OJK and is part of the reform stages carried out by the OJK in the insurance industry sector, so that marketing and management of insurance products can run more prudently, fairly, and transparently," he said.

Meanwhile, the capital of the life insurance industry is still well maintained, where Risk Based Capital (RBC) is large above the threshold of 460.06 percent and 315.79 percent, respectively.

"Although the RBC is in a downward trend and the RBC of several insurance companies is closely monitored, the insurance industry's RBC aggregate is still above the threshold of 120 percent," he said.

Another Non-Bank Financial Industry (IKNB), which is a financing company, is also still recording stable capital performance, as seen from the gearing ratio of 2.11 times or far below the maximum limit of 10 times.

OJK noted that outstanding financing receivables grew 16.35 percent year on year in March 2023 to IDR 435.53 trillion, supported by working capital and investment financing, which grew by 34.25 percent and 19.14 percent, respectively.

The risk profile of Financing Companies is still maintained with a non-performing financing ratio (NPF) recorded an increase of 2.37 percent.

On the other hand, the pension fund sector recorded an asset growth of 4.74 percent with an asset value of IDR 350.08 trillion.

The performance of FinTech peer to peer (P2P) lending in March 2023 also still recorded growth with outstanding financing of fintech p2p growing by 36.45 percent to Rp51.02 trillion.

"Meanwhile, the aggregate credit risk rate (TWP90) was recorded to have increased to 2.81 percent," he said.