It is undeniable that the pandemic has created a crisis in various markets, including insurance. Nevertheless, Insurance managed to bounce back to its pre-pandemic position and is now growing steadily. The Total income of life insurance itself is rumored to have reached Rp. 62.3 trillion in Q1-2022.
Public asset insurance or state property
Based on banking data in February 2022 and The Life Insurance Industry and mutual funds in March 2022, insurance took first place in the total assets of the financial services sector as a business line under the Financial Services Authority (OJK) and the Non-Bank Financial Industry (IKNB). Total life insurance assets reached 617 trillion originating from at least 60 insurance companies in Indonesia. This figure is the result of an increase of 6.6% from Q1-2021.
This was stated by Budi Tua Arifin Tampubolon, Maitrise, MM, AAIJ, FSAI, AMRP. as chairman of the Board of the Indonesian Life Insurance Association (AAJI) in the Webinar “cross-disciplinary involvement in the development of The Life Insurance Industry” organized by Parahyangan Catholic University (UNPAR) with AAJI on Friday (17/6/22) and then in a hybrid at the Lecture theater of the Arntz-Geise Learning Center (PPAG) UNPAR.
Although the percentage of insurance revenue is gradually good, Budi stated that the density and penetration rate of Indonesia’s life insurance industry is still far behind compared to other countries.
“Density is the value of money spent by the people of a country for life insurance protection, generally measured in USD while penetration is how much life insurance contributes to our GDP,” said Budi.
With regard to life insurance, he further said that between new business and renewal business, management must be differentiated to maintain portfolio balance.
“New business is when one customer buys a long-term life insurance policy while business renewal is an Advanced year. Distinguishing new business and renewal business is important in life insurance, ” he said.
Meanwhile, the Chief Actuary and Senior Vice President of PT. InHealthDr Life Insurance. Benny Hadiwibowo, S.Si, MM, FSAI, CNLA, AAIJ, AAK, AMRP, QIP, CPLHI, FLMI, ARA. states that insurance companies are not only limited in actuarial. According to him, insurance companies should have at least underwriting, actuarial, and claims administration functions.
“When it comes to insurance, we’re not just talking actuarial. It turns out that in the insurance there must be several work units involved.”said Benny.
According to him, anyone can become an actuary. The role of Actuaries in insurance companies does not rule out coming from other fields of science other than mathematics.
“Indeed, an actuary is someone who is an expert in mathematics, statistics, or economics, risk management related to business issues in the company. For my friends majoring in mathematics, it may be easier to flow to actuaries. Although there is also a friend of mine graduated in economics could be an actuary. Engineering can also be an actuary as long as he takes actuary certification,” said Benny.
As for Benny gives an overview of the scope of duties and responsibilities of an actuary including :
Designing insurance products includes determining premium rates and profitability over insurance products.
Evaluate the level of financial health and capital adequacy of insurance companies.
Performs the calculation of the technical reserve of the insurance company.
Conduct statistical data quality test of insurance companies.
Participate in the implementation of Corporate Risk Management.
Evaluate actuarial aspects of the insurance process at the insurance company.
Draw up an estimate of the insurer’s ability to fulfill obligations in the future.
Behind that, there are five major actuarial unit structures that must be mastered, said Benny, including Pricing, valuation, Product Development, reinsurance, and Data Analysts.
“So, my friends, when you become an actuary, you must master these five aspects, yes. Not just calculating premiums, not just reporting, but all these aspects. And it is likely that in the future it will be more because the wider the business, the development of business, this will automatically develop again.”Benny