AAJI Reveals Life Insurance Revenue Reaches IDR 219.70 Trillion Throughout 2023

AAJI's press conference regarding the achievement of Insurance in 2023 (Photo: AAJI)

JAKARTA The Indonesian Life Insurance Association (AAJI) reported the performance of 56 Life Insurance Companies for the period January 2023 to December 2023. The Life Insurance Industry recorded a positive performance in the sale of traditional life insurance products.

Chairman of the AAJI Management Board, Budi Tampubolon, said that throughout 2023 AAJI recorded good growth in traditional insurance products.

Meanwhile, the unit link life insurance product is still in demand by people who need investment features in their insurance products.

"Although recorded a decline compared to 2022, the unit link life insurance product still shows growth. Until the end of 2023, the premium of the unit link life insurance product reached IDR 85.33 trillion," Budi said in his official statement, Tuesday, February 27.

Budi said that while traditional life insurance products still dominate premium income with a total acquisition of Rp92.33 trillion, an increase of 14.1 percent compared to 2022.

In general, the total life insurance income until the end of 2023 amounted to IDR 219.70 trillion. This figure decreased slightly by 2 percent when compared to total revenue in 2022.

The provision of life insurance premiums until the end of 2023 amounted to IDR 177.66 trillion. Investment results showed positive growth by rising 46.2 percent or reaching a total of IDR 32.03 trillion," Budi continued.

The life insurance industry in 2023 recorded positive achievements with a insured amount of 84.84 million people, an increase of 0.5 percent. Total coverage money also increased 9.9 percent to Rp5,343.43 trillion.

Budi conveyed from the data that each individual who has life insurance on average has IDR 63 million in coverage.

However, when compared to the current minimum wage value of Jakarta of IDR 5.6 million, it can be concluded from this figure that the life insurance industry can provide family financial resilience to each policyholder for approximately 12 months in the event of a risk resulting in financial losses.

"The higher the coverage money it has, the more it will strengthen its financial resilience," said Budi

In terms of health insurance claims, AJII noted a significant increase throughout 2023. The main driving factor is high medical inflation, including health facility prices, hospital care costs including service costs, drugs and various medical tests.

Budi said another factor was extreme climate change and increased public awareness to get optimal health services.

To overcome this challenge, the life insurance industry takes steps such as reviewing cooperation with hospitals, evaluating products and premiums based on claim experience, and facilitating discussions between AAJI member companies.

Furthermore, the life insurance industry supports OJK's steps to sign a Memorandum of Understanding (MoU) with the Ministry of Health (Kemenkes) to strengthen the health ecosystem through quality health insurance products and services.

In line with that, AAJI is reviewing the formation of information exchange methods between member companies to create a more transparent, accountable and efficient health sector.

Budi said responding to OJK's hope for transparency in the health insurance sector and other insurance products. AAJI is studying data center formation while still prioritizing customer data security.

"We hope that this data center can minimize fraud and facilitate the underwriting process at insurance companies," said Budi.