The Indonesian reinsurance market is set to benefit from robust growth over 2018, with the Indonesian General Insurance Association (AAUI) estimating that premiums will increase by at least 10%, according to a report by Kontan.
The Indonesian Financial Services Authority (OJK) calculated that the country’s reinsurance industry posted gross premiums of Rp 3.7 trillion (USD 262 million) at end of March 2018, an increase of 25% compared with the same period from the previous year.
AAUI’s Executive Director, Dody Dalimunthe, said that the Association “estimates conservative growth in 2018”, but added that the reinsurance market’s growth may exceed 10% if the goals set by the government are realised.
The government is expected to introduce new incentives and schemes for insurers to increase market penetration in the future, which will provide many new opportunities for reinsurers.
Plans include mandatory motor third party liability business, natural disaster insurance, and insurance of state property, and the Ministry of Marine Affairs and Fisheries has already made progress in providing insurance cover for shrimp and fish farmers.
“There is also export insurance for palm oil, coal and rice imports by the Ministry of Commerce,” explained Dalimunthe.
Catastrophe reinsurer PT Reasuransi Maipark Indonesia alone grew its premium revenue by 79.52% year on year at Q1 2018, while PT Reasuransi Indonesia Utama (Indonesia Re) claimed to have earned premiums of around Rp 2 trillion (USD 142 million) in the same period, and expects its premiums to double over 2018.
PT Reasuransi Indonesia (Marein) is also optimistic about premium growth, with its Director, Yanto Wibisono, forecasting increases of 27.7%, according to Kontan.
