JAKARTA - Bank Indonesia (BI) noted that the total assets of the insurance industry reached IDR 1.637 trillion in March 2022, an increase of 12.9 percent when compared to the same period the previous year or year on year (yoy).
These assets include investments of IDR 1.345 trillion or 82 percent of total assets.
"The insurance industry in Indonesia is showing positive progress in terms of investment," said BI Senior Deputy Governor Destry Damayanti as quoted by Antara, Tuesday, May 31.
Not only the insurance industry, Destry said that pension funds also showed rapid progress by recording a total net asset of IDR 329 trillion or grew by around six percent (yoy).
These assets consist of IDR 321 trillion in investments or 27.5 percent of all assets owned by pension funds.
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Therefore, he assessed that the development of institutional investors such as insurance and pension funds is very important to deepen the Indonesian financial market.
"Investors in insurance and pension funds have great potential for long-term savings which are very suitable for long-term investments such as infrastructure financing," he said.
What's more, according to him, pension funds and insurance allow the economy to manage risk better.
Currently, Indonesia's domestic financial market is still relatively shallow, as indicated by the limited volume of transactions, instruments, and market players.
To achieve Indonesia as a developing country, Destry emphasized that deep financial markets are needed to provide rupiah stability as a fundamental for Indonesia's sustainable development and mitigate systemic risks.
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