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Business in life insurance faces heavy challenge in Indonesia.

Business in life insurance is facing heavy challenges in Indonesia with financial problem and difficulty in attracting investors. The root of the problem is decline in interest rate and business uncertainty amid low purchasing power of the people and the fact that insurance is not quite popular in the country.

The rupiah fall lately against the U.S. dollar worsened the condition. The amount of premium and income from investment decline. Total amount of premium was only around 1.25%-166% of the country' Gross Domestic Product (GDP) in the 1997-2001 period. In 2002, premium was Rp 11.3 trillion or an increase of 9.7% from the previous year. In 2003, insurance industry grew by an average of 30% as against 70% in 1997.

The collapse of property business and liquidation of many banks contributed to the difficulties faced by insurance companies as the impact was bad for investment in certain sectors. Fortunately income in interest on deposits helped maintain growth.

The rupiah fall against the dollar caused an increase in costs burdening the business sector including insurance. Meanwhile, limited capital makes it difficult for insurance companies to cover large insurance forcing them to seek reinsurance with foreign partners.

Low economic growth and an increase in unemployment rate further weakened the purchasing power of the people in general. Based on official data, only 16% of the country's population of 215 million hold life insurance polish.

Life insurance companies compete not only among themselves but also against banks and mutual funds because of the absence of clear limits of business areas among the financial companies.

For example, the products of link unit and mutual fund are almost the same with market. The different lies in the regulators. Mutual fund is under the Capital Market Supervisory Body (Bapepam) and link unit is under the Insurance Directorate of the Finance Ministry. In other countries the regulators of the two products is one.

Slow growth

The law No. 2 in 1992 said life insurance companies offer service in meeting risk of death. Therefore, life insurance companies could operate in life insurance, health insurance, accident insurance and found and manage pension fund.

Life insurance offers an alternative for the people to invest. Life insurance generally has a longer term than loss insurance. With longer protection of 5 to 30 years its investment has longer term such as in property, direct participation. Bonds and mortgage loan.

Despite the fact that most life insurance companies are facing liquidity problem, there has been no life insurance company declared bankrupt

or liquidated as the case with many banks. In addition, despite incentive offered by the government for merger no life insurance companies have comply with the call for merger.

Based on data at the Indonesian Insurance Council (DAI), by the end of 2003, the country had 55 life insurance companies including a state-owned company, 33 Indonesian private companies and 21 foreign joint ventures. The companies had around 80,000 agents altogether. Business in life insurance in the country grew sluggishly. The number of companies did not change much from 53 in 1999 including a state-owned company, 40 Indonesian private companies and 12 joint ventures.

In the past five years, the number of joint venture life insurance companies grew to from 12 to 21 units. On the contrary the number of Indonesian private companies declined from 40 to 33. The decline was likely caused by financial difficulty to resume business. Some of them were taken over by foreign investors.

Performance declines:--Business restriction imposed on some companies

The vulnerability of life insurance industry is indicated by the growing number of companies included in the list of Business Activity Restriction from year to year. The restriction was imposed on companies having a Risk Based Capital (RBC) of less than 100% as set by the finance ministry in 2003. The minimum RBC was raised to 120 in 2004.

Sufficient amount of capital is needed to cover risks of losses as a result of deviation in the management of assets and obligations. Therefore, financially powerful, companies will survive amid the situation such as prevailing at present in the country, but small companies will most likely collapse without additional capital.

Legal uncertainty is also a factor slowing the growth of life insurance companies in the country. For example, the finance ministry allows companies failing to meet the minimum RBC to continue operation. After three years there has been no firm measure taken against them.

Limited capital has always been a problem. Expansion of business means more risks to be faced. Large capital, therefore, is needed to cover the risks. As a result more and more companies are included in the list of Business Activity Restriction because of low RBC.

By the end of 2003, there were still five companies having RBC below 100%. They were Asuransi Republik (minus 156%), Asuransi Tugu Indo (minus 93%), Asuransi Raya (minus 71%), Pasaraya General Insurance (14%) and Asuransi Dharma Bangsa (41.60%).

Based on the RBC requirement of 120% a number of insurance companies should not be allowed to operate. At least there are six life insurance companies having RBC between 100% and 120%.

Companies facing difficulty to meet the RBC requirement are recommended to seek merger with financially powerful companies. However, it is not easy to find such partner when there is no legal and business certainty.

As long as there is no legal certainty that will guarantee business certainty it is difficult to expect foreign investors to venture in insurance business in the country. Most possible is acquisition by companies operating in the country such as the takeover by Prudential Life Assurance of business of Asuransi Paja, whose license has been revoked merging of AJ Principal Egalita Indonesia into AJ Manulife Indonesia and ING Life Indonesia takeover of the business portfolio of ING Aetna Life Indonesia. The trend, therefore, is large companies getting bigger and small companies are sidelined.

There are 12 companies include din the List of Business Activity Restriction consisting of 8 life insurance companies and 5 general insurance companies. See the following table.

Once they are included in the restriction, very little chance they will survive. Most likel they will die slowly.

Investment concentrated more in shares and bonds

Previously funds of life insurance companies were deposited in banks and in Bank Indonesia Certificate (SBI) when the interest rate was still attractive and the risk was smaller. High interest rate on deposits prompted many insurance companies to convert their foreign exchange into rupiah.

Now, however, with interest rate declining deposits are no longer attractive. Now investment in bonds and shares are considered more profitable. Shares and bonds now account for 30% of investment by life insurance companies. Securities issued or guaranteed by the government account for 27% as against deposits accounting for only 21%.

The requirement set by the government for insurance companies to put at least 5% of their investment in deposits is seen as an additional burden for them as the deposit may not be withdrawn while they have to maintain liquidity. Meanwhile deposit interest now averages 6%. Insurance companies, therefore, put most of their money in bonds, mutual funds and shares.

Meanwhile life insurance companies are facing the possibility of negative spread. Though not yet visible, that tendency is there with the shrinking interest rate. Negative spread already caused problem for life insurance companies in a number of other countries. Income from investment is not enough to cover compensation for policy holders.

The declining interest on SBI and deposits requires greater prudence in the management of insurance business. They should maintain their liquidity and cope with growing costs and low increase in premium as the real sector has remained in the doldrums and has not fully recovered.

Life insurance companies have to put more their investment in areas more profitable or sector with greater return. They could also change agreement on the insurance compensation with their policy holders, but it is not easy as the generally the contract is long term from 5 to 10 years.

Currently, 20 life insurance companies dominate 93.75% of premium market and 20 general insurance companies dominate 75.97% of the market. There are different views about what the country needs with the present condition. One opinion said the country needs few insurance companies with large coverage and another said few large companies could not possibly cover the market demand, therefore small insurance companies should be protected.

Ratio of investment to technical reserve growing

Technical reserve is an accumulation of premium income and interest received to pay claims. Therefore, a decline in premium income will cause a decline in technical reserve, meaning a decline in the capacity to cover claims.

Failure to cover claim is caused mainly by the fact that life insurance companies invest too much in time deposit and property at the expense of technical reserve. As a result there is imbalance in growth with investment exceeding technical reserve or the ratio of investment is too high. A decision of the finance minister No 224/1993 said among other things that investment is at least the same as technical reserve or in other word investment is allowed to exceed technical reserve.

Until 1997, the total amount of technical reserves of life insurance companies exceeded total investment or the investment ratio was below 100%. However, since 1998, the ratio was more than 100% because of a decline in insurance as a result of the monetary crisis.

In 2003, among the 55 life insurance companies 10 had investment larger than technical reserve. Among them is Rama Life, which by the end of 2003 has technical reserve of Rp 1,873 million as against investment of Rp 4,884 million and Prudential Life Assurance and Panin Life, which have investment ratios of 180% and 174.26% respectively in the past two years.

Government Policies not Favorable

As long as the Bankruptcy Law No.4/1998 has not been revised insurance industry will continue to face a threat of being liquidated. Life insurance companies are more vulnerable to bankruptcy suit than general insurance companies. Therefore, the association of general insurance companies (AAUI) and the association of life insurance companies (AAJI) strongly demand revision of the law.

The government has no solution yet to problem over dispute with policy holder in the event of liquidation of insurance companies. The existence of an institution to guarantee policy, therefore, is necessary like the saving underwriters in the banking sector. The absence of such institution may have made the government look hesitant to liquidate bad performing insurance companies.

Insurance Director Firdaus Djaelani at the finance ministry said the companies now included in the Business Activity Restriction showed no improvement. They are Asuransi Buana Putera, Asuransi Jiwa Pura Nusantara, Namura Life and Nabasa Life Insurance. Based on the RBC regulation, they have been long liquidated.

Case of Prudential Life Assurance

In April 2004, the Central Jakarta Commercial Court gave a bankruptcy verdict for Prudential Life Assurance, favoring bankruptcy demand filed by Lee Boon Siong, a Malaysian, who was agent of the British life insurance company. The court ruled Prudential to pay a compensation of Rp 366.7 billion to the claimant. Based on the verdict Prudential was to stop operation starting April. The company has shown good financial performance and was quite solvent. Therefore, the bankruptcy of Prudential was merely on a legal case not because of financial failure.

Prudential Life Assurance is 94.5% owned by Prudential Assurance Company Ltd. Of Britain and 5.5% by PT. Sasana Dwi Paramitra. It started operation in the country in 1995 and now it has 6 marketing offices, 61 agency offices, 14 financial advice centers. It has 230 employees and 8,000 marketing officers.

Based on its financial report in 2003 it financially very healthy with assets at Rp 1.5 trillion, premium values at Rp 1 trillion including Rp 927 billion in link unit premium. In the link unit segment, Prudential is a leader with its PRUlink. It has an RBC of 255% meaning a capability to cover 2.5 times its minimum obligation.

The bankruptcy verdict in April, 2004 triggered controversy. It weighed hard on the already low confidence of the public in insurance. Worse still it further damaged international confidence especially foreign confidence in the country. Investors saw absence of legal certainty in the country. Fortunately the Supreme Court reversed the decision of the commercial court in June, 2004. Prudential is allowed to resume operation in the country. While under the bankruptcy verdict before the Supreme Court annulled the verdict, Prudential succeeded in listing 3,000 new policy holders.

10 Largest Life Insurance Companies

In term of financial strength, there are 10 life insurance companies categorized as healthy. With assets valued at Rp 4,284,541 million, PT. AIG Lippo Life is the largest life insurance company in the country, followed by state-owned Asuransi Jiwasraya with assets valued at Rp 2,752,501 million, Indolife Pensiontama, an Indoensian private company with assets at Rp 1,668,308 million. The smallest among the ten is Asuransi Jiwa Eka Life with assets valued at Rp 684,545 million.

In term of gross premium income, Asuransi AIG Lippo Life also leads with gross premium of Rp 1,920,260 million, followed by. Asuransi Jiwasraya with gross premium of Rp 1,090,294 million. The smallest among the ten is Asuransi Eka Life with gross premium income of Rp 181,996 million.

With investment valued at Rp 3,793,361 million, Asuransi AIG Lippo Life, leads over other companies in investment value, followed by Asuransi Jiwasraya with investment at Rp 2,426,961 million. See the following table.

Local versus Foreign

The number of 55 life insurance companies in the country is considered too many. The number considered ideal is between 25 and 30 companies. Foreign investors said domestic insurance companies have capacity exceeding the market demand. As a result foreign investors have little room for penetration.

The largest among the life insurance company is Asuransi AIG Lippo Life. The Indonesian-American joint venture has 3,600 agents and it hopes to increase the number soon to 4,400 agents. It is superior in experience, human resource, finance and information technology and technology compared with Asuransi Jiwasraya, the second largest in the country.

Asuransi AIG Lippo Life is owned by the Lippo Group and AIG (American Internatioal Group Inc from the United States. Currently AIG Lippo Life is a pioneer and at the same time a player in bancassurance. Its financial performance is excellent with RBC of 210% in 2003 well above the minimum limit of 120%. Currently it has market share of 29% with gross premium of Rp 1,929,260 million in 2003. It has clients in 65 cities in the country with 3,600 agents.

Asuransi Jiwasraya, the only state company operating in life insurance industry, has expanded rapidly from year to year with 17 regional offices, 70 branch offices and 286 area offices. Asuransi Jiwasraya expands operation through investment in capital participation and subsidiaries operating in various business areas including real estate, apartment, golf courses, office building. The subsidiaries include PT. Stania Bhineka Jasa, which is wholly owned, Pondok Indah Padang Golf (0.23%), PT. Arthaloka Indonesia (2.88%), PT. Langen Krida Pratyangga (0.40%). It has joint venture with PT. Asuransi Jasindo and PT. Adhi Karya to establish PT. Mitrasraya Adhijasa in which it is a 55% shareholder. Jiwasraya, however, plans to sell its assets in the joint venture company as it is no longer profitable. And has ceased operation since 2001.

The suggestion that foreign companies have always been superior is not entirely correct. Asuransi Bringin Life, a local company, reported the best financial performance in among the medium life insurance companies despite domination by joint venture companies.

Total investment of Bringin Life was Rp 414 billion in 2003 or an increase of 20% from the previous year of Rp 329 billion. Its premium income rose to Rp 466 billion in 2003 from Rp 393 billion in 2002.

Astra CMG Life was second among the medium life insurance companies . In the past five years it recorded an annual growth of 27%. Now it has assets valued at Rp 579 billion with 1,200 agents.

Marketing and Business Strategy

Generally all life insurance companies adopt a more or less the same marketing and business strategy.

1. First they adopt a low cost strategy facing competition from banks.

2. Second, by increasing distribution channels such as through bancassurance that is by promoting sales of products through banks.

3. The third is through market penetration. Some client refuse to meet agents, but some markets need agents especially outside Jakarta.

4. The fourth is by improving the quality of human resource especially agents who deal directly with policy holders or prospective policy holders. Training, therefore is necessary. Hijacking of skilled agents by more powerful insurance companies is now faced by Indonesian insurance companies. The 80,000 insurance agents in the country have different levels of skills. To cope with the problem, the Life Insurance Association (AAJI) has named Singapore College of Insurance to handle certification of life insurance agents.

5. The fifth is customer retention. Now policy holders are offered to buy more than one product. Agents are required to be able to persuade policy holders to buy more than just one products.

In addition to the strategies mentioned above life insurance companies need to follow the standard and general strategies as follows:

* Providing good service to customers

* Providing integrated service, easy and fast.

* Maintaining the confidence of the customers

* Maintaining loyal customers

* Identifying market

* Expanding market by opening more branch and representative offices to be close to customers

* Paying claims as scheduled

* Offering good quality and competitive products which are high in demand in market.

Level of Competition

The competition among life insurance companies it tight at present. The market is dominated by financially powerful companies either foreign and domestic companies. The opportunity, however, is still open for medium scale insurance companies which have own market segment not yet entered by large companies.

The domestic market is 90% dominated by 15 large insurance companies. Small companies have only a market share of 10%. The condition is lopsided with small companies having to struggle hard for survival.

Bancassurance could serve as an alternative amid the slump in investment but bancassurance has not grown well. Only a few have made good progress in bancassurance such as AIG Lippo Life. Bancassurance contribute 60% to its premium income with agents accounting for only 30%. The contribution of bancassurance for Allianz Life Indonesia, is only 20%.

Budisuharto, Deputy President Director & Chief Marketing AIG Lippo Life, said the chance of success is greater by marketing of insurance products via banks than through agents.

From the interest of consumers, the present condition with the tight competition is good but in the long run the condition could lead to unhealthy competition. In fact indications of unhealthy competition could be seen with the hijacking of skilled agents and tariff war with one undercutting each other in price.

Market Potential of Syariah Insurance

Lately, apart from conventional insurance industry, there is new business in syariah insurance. Basically syariah insurance and conventional insurance operate in the same system. The difference is that syariah insurance companies manage insurance fund on Islamic rule or syariah principles. Syariah insurance is no serious competitor to conventional insurance as it seeks only to meet demand from some of the people to have insurance based on Islam.

Currently syariah insurance has succeeded only in grabbing a 1% share of the conventional insurance market, which was valued at around Rp 30 trillion in premium income in the country in 2003. The association of syariah insurance (AASI) has 18 members in 2003. In the next five years syariah insurance industry is expected to chalk up Rp 7 trillion in premium income of the total market of Rp 74 trillion.

AASI said the bottleneck in the development of syariah insurance is the low authorized capital of only Rp 2 billion for a syariah branch. It said the government should increase the required limited capital to Rp 5 billion to meet growing demand for syariah insurance especially in the region. Svariah insurance provides more alternative for the people.

Conclusion and Prospects

The decline in the performance of insurance industry especially life insurance is caused by four factors namely: First is macro economic condition with low interest rate and fluctuation of currencies resulting of a decline in yield of insurance investment especially in deposits and SBI.

Second is imbalance in competition among small and big insurance companies. Third is limited capital among many insurance companies. Fourth is legal uncertainty and unfavorable condition such as in the case of Prudential Life reducing investors' confidence in the country. The government needs to produce effective regulations favorable to the market as the prospects for life insurance are still encouraging. Until now only 16% of the market potential in the country of 215 million. 's population has been exploited. The percentage could still be increased in the coming years. The people need only to be convince about the important of insurance protection especially when the economy has improved.
Table--1

Number of life insurance companies in Indonesia

Year State co. Indonesia Joint Total
 private co. venture

1999 1 40 12 53
2003 1 33 21 55

Table--2

Life insurance companies and paid up capital, December, 2003

No Name of companies Paid up capital (Rp
 mln)
 Indonesian private companies:
1 Panin Life 1,497,118
2 Asuransi Syariah Mubarakah 135,000
3 Asuransi Jiwa Bringin Sejahtera 70,000
4 Asuransi Jiwa Adisarana Wanaartha 70,099
5 Asuransi Jiwa Central Asia Raya 50,000
6 Asuransi Jiwa BNI Jiwasraya 20,385
7 Asuransi Jiwa Bakrie 17,853
8 Asuransi Takaful Keluarga 17,000
9 Asuransi Bumi Asih Jaya 7,005
10 Asuransi Jiwa Askrida 6,887
11 Asuransi Jiwa Miralife 6,052
12 Asuransi Rama Life 5,000
13 Pasaraya Life Insurance 5,000
14 Asuransi Jiwa Austindo 5,000
15 Asuransi Jiwa Century Lifindo Perdana 4,500
16 Asuransi Jiwa Berkah Harda Sentosa 4,000
17 Asuransi Jiwa Mantari Mulai Sejahtera 2,500
18 Anugerah Life Insurance 2,500
19 Indolife Pensiontama 2,000
20 Asuransi Jiwa Bumiarta Reksatama 2,000
21 Asuransi Jiwa Mukzijat Utama 2,000
 State company:
1 Asuransi Jiwasraya 235,000
 Joint Ventures :
1 Asuransi Allianz Life Indonesia 480,750
2 Asuransi AIG Lippo Life 477,711
3 Metlife Sejahtera 126,564
4 AXA Life Indonesia 124,500
5 Prudential Life Assurance 111,500
6 Astra CMG Life 91,550
7 Sun Life Financial Indonesia 76,600
8 Asuransi Jiwa John Hancock Indonesia 61,194
9 AXA Mandiri Financial Services 59,472
10 Equity Financial Solution 53,195
11 Asuransi Jiwa Sequis Life 49,020
12 Credit Suisse Life & Pensions Indonesia 44,500
13 MAA Life Assurance 38,943
14 Asuransi Jiwa Asih Great Eastern 32,301
15 Heksa Eka Life Insurance 30,000
16 MLC Life Indonesia 29,497
17 Asuransi Cigna Life 20,000
18 Asuransi Jiwa Eka Life 17,500
19 UOB Life Sun Assurance 13,500

Source: DAI

Table--3

Risk Based Capital of insurance companies by Dec. 2003

Risk Based Capital Life Insurance General Insurance

More than 120% 36 78
100%-120% 6 9
Below 100% -- 5
Data not available 1 --

Source: DAI

Table--4

Companies include din the List of Business Activity Restriction

No. Name of companies Type of insurance business

1 Asuransi BHS Life Life insurance
2 Asuransi Jiwa Buana Putra Life insurance
3 Asuransi Jiwa Pura Nusantara Life insurance
4 Asuransi Inda Tamporok Life Life insurance
5 Koperasi Asuransi Indonesia General insurance
6 Nabasa Life Insurance Life insurance
7 Asuransi Namura Life Life insurance
8 Asuransi Nugra Pacific General insurance
9 Asuransi Purwandjasa General insurance
10 Asuransi Securindo Adhigama General insurance
11 Asuransi Sakarukma Sinukarta Life insurance
12 Asuransi Kharisma Persada Raya General insurance
13 Asuransi Genesha Danamas Life insurance

Source: DAI

Table--5

Investment portfolio of life insurance companies in Indonesia, 2003

No Description Earning Portion (%)
 (Rp million)

1 Deposits and deposit certificates 4,530,890 21.97
2 Bank Indonesia certificate (SBI) 307,230 1.49
3 Shares and bonds 6,263,379 30.37
4 Securities issued/guaranteed by the 5,731,708 27.79
 government
5 Mutual fund 1,295,647 6.28
6 Direct participation 1,320,331 6.40
7 Building, Land and buildings 562,574 2.73
8. Other investments 515,180 2.50

Source: DAI/Data Consult/data processed

Table--6

Develolement of life insurance industry, 2002-2003

No. Description Value Growth year-on-
 (Rp million) year (%)

1 Total assets 23,075,405 24.56
2 Investment 20,625,977 26.41
3 Non Investment 2,449,427 10.86
4 Debts 1,428,661 25.02
5 Technical reserve 16,991,930 26.27
6 Liabilities 18,420,591 26.17
7 Paid up capital 4,201,696 (4.05)
8 Equity capital 4,509,310 19.76
9 Gross premium 10,390,930 22.72
10 Net premium 10,072,559 22.95
11 Profit (Loss) before tax 494,564 1.800

Source: DAI/Data Consult/processed

Table--7

Ten life insurance companies n with investment exceeding technical
reserves, 2003

(Rp million)

 Name of companies Investment Technical Portion %

Asuransi Rama Life 4,884 1,873 210.30
Prudential Life Assurance 1,450,734 1,205,440 180.00
Panin Life 1,789,159 532,991 174.26
Asuransi Jiwa Asih Great Eastern 35,751 26,970 132.54
AXA Life Indonesia 267,638 262,823 131.00
Asuransi AIA Indonesia 1,474,740 1,137,367 127.00
Asuransi Jiwa BNI Jiwasraya 172,310 151,509 126.87
Asuransi Cigna 158,537 137,617 119.00
Indolife Pensiontama 1,642,841 1,426,717 115.15
Asuransi AIG Lippo Life 3,793,361 3,063,837 112.00
MLC Life Indonesia 355,462 324,105 110.00

Source: DAI/Data Consult

Table--8

Performance of Prudential Life Assurance

Description 2003 2002

Total assets 1,567.66 756.58
Equity capital 202,594 125,213
Premium income 1,018.80 476.77
Link unit remikum 927.619 383.236
Profit 78,060 18,629
Liquidity ratio 110% 109%
Risk Based Capital 255% 141%

Source: Data Consult/processed

Table--9

Financial performance of major life insurance companies, 2003

(Rp million)

 Name of Total Investment Non Debt
 companies Assets Investment

Asuransi AIG 4,284,541 3,793,361 491,180 435,648
Lippo Life
Asuransi Jiwasraya 2,762,501 2,426,961 325,540 49,023
Indolife 1,668,308 1,642,841 25,467 1,776
Pensiontama
Asuransi Jiwa 1,651,777 1,562,629 89,148 65,112
Sequis Life
Asuransi AIA 1,590,831 1,474,740 116,091 231,443
Indonesia
Prudential Life 1,567,658 1,490,734 116,924 159,624
Assurance
Asuransi Allianz 980,780 809,503 171,277 53,350
Life Indonesia
Panin Life 1,836,842 1,789,159 47,683 10,812
Asuransi Jiwa 1,057,155 980,453 76,702 47,316
Central Asia Raya
Asuransi Jiwa 684,545 575,589 108,956 18,451
Eka Life

 Name of Liabilities Technical Paid up Equity
 companies reserve capital

Asuransi AIG 3,499,485 3,063,837 477,711 785,056
Lippo Life
Asuransi Jiwasraya 2,383,939 2,334,916 235,000 368,563
Indolife 1,428,493 1,426,717 2,000 239,815
Pensiontama
Asuransi Jiwa 1,490,174 1,425,062 49,020 90,497
Sequis Life
Asuransi AIA 1,368,810 1,137,367 4,500 222,021
Indonesia
Prudential Life 1,365,064 1,205,440 111,500 202,594
Assurance
Asuransi Allianz 837,751 784,401 480,750 143,029
Life Indonesia
Panin Life 543,803 532,991 1,497,118 1,293,039
Asuransi Jiwa 928,727 881,411 50,000 128,428
Central Asia Raya
Asuransi Jiwa 555,399 536,949 17,500 129,145
Eka Life

 Name of Gross Net Profit (Loss)
 companies premium premium before tax

Asuransi AIG 1,929,260 1,911,481 153,688
Lippo Life
Asuransi Jiwasraya 1,090,294 1,079,575 59,476
Indolife 896,811 896,763 12,153
Pensiontama
Asuransi Jiwa 526,634 520,847 55,248
Sequis Life
Asuransi AIA 520,063 504,760 62,626
Indonesia
Prudential Life 1,016,801 1,007,784 71,092
Assurance
Asuransi Allianz 718,881 691,301 (54,169)
Life Indonesia
Panin Life 492,602 484,185 152,315
Asuransi Jiwa 389,571 368,897 20,923
Central Asia Raya
Asuransi Jiwa 181,996 179,125 5,068
Eka Life

Source: DAI

Table--10

Market potential of syariah insurance in Indonesia

(Rp trillion]

Description 2004 2005 2006 2007 2008

Conventional insurance 38.85 45.47 53.44 63.05 74.67
Loss insurance 20.65 25.62 31.77 39.39 48.85
Life insurance 18.19 19.85 21.67 23.66 25.82
Syariah insurance 0.78 1.82 3.21 5.04 7.47

Source: AASI 2004
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Title Annotation:Industry Profile
Publication:Indonesian Commercial Newsletter
Geographic Code:9INDO
Date:Jul 27, 2004
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