Life insurance company PT Avrist Assurance is expecting a 50 percent increase in its annual premium equivalent (APE) this year, a jump of more than double from the 18.18 percent growth recorded in 2017.
With such a high growth target, PT Avrist believes it will become one of the country’s top 15 life insurance companies in 2021, president director Anna Leonita has said.
The APE, commonly used to assess companies in the life insurance industry, is calculated by taking the value of regular premiums then adding 10 percent of any new single premiums written for a fiscal year.
Anna said that Avrist’ gross premium, which consists of regular and single premiums, was Rp 1.6 trillion in 2018. Its regular premiums rose 11 percent to Rp 898 billion (US$63 million) last year from Rp 808.86 billion in 2017, while its single premiums declined 14.71 percent to Rp 709.18 billion from Rp 813.57 billion.
The solvency ratio of the insurance company was among the highest in the industry in 2018, reaching 434 percent or 3.6 times higher than the minimum level required by the Financial Services Authority (OJK).
Avrist director of finance Ho Kan Tak said that to achieve the APE goal, the company was promoting its traditional life insurance products among middle-class consumers.
The traditional insurance products including health and accident insurance contributed 70 percent to the total premium income and the other 30 percent came from investment-based products.
Anna acknowledged that its insurance products were not hugely popular domestically because the majority of Indonesians neglected insurance at an early age.
“Millennials, for example, prefer to spend their money on lifestyle needs, rather than buying insurance premiums. For this reason, we keep trying to adjust our marketing strategies to their trends,” Anna said.
Consequently, she said, Avrist had made various branding efforts to penetrate the millennial market by taking part in seasonal events, including the Java Jazz Festival.
“During the last fasting month of Ramadan, Avrist promoted its brand at a takjil (breaking-of-the-fast snack) distribution event by providing each recipient with 30-day accident insurance,” said the company’s head of corporate marketing and communication, Ernest Febrianto.
Anna said Avrist’s after-tax profit increased 47.53 percent to Rp 249.04 billion in 2018 from Rp 168.80 billion in 2017. This year, its after-tax profit is projected to increase by between 15 and 20 percent.
“The profit growth is not significant because we need to expand further and invest more in information technology and human resources,” Ho Kan said.
Avrist currently has 3,500 agents marketing its products to individuals.
Established in 1975 as the first joint venture life insurance company, Avrist has used its over 40 years of experience to develop distribution channels for agencies, bancassurance, employee benefits and sharia-based life insurance.
In 2010, Avrist formed a partnership with Meiji Yasuda Life Insurance Company, one of the market leaders in the life insurance industry in Japan with more than 130 years of experience.
At present, Avrist has three subsidiaries, namely the Avrist Financial Institution Pension Fund (DPLK), PT Avrist General Insurance and PT Avrist Asset Management.
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