Ciputra Life Attributes Life Insurance Premium Decline to Weak Consumer Spending

Industry Challenges and Company Response

PT Asuransi Ciputra Indonesia (Ciputra Life) has reported that the Indonesian life insurance industry faced a significant contraction in premiums during the first nine months of 2025. The total life insurance premiums reached Rp132.85 trillion by September 2025, representing a 2.06% year-on-year decline. According to Hengky Djojosantoso, CEO of Ciputra Life, the primary factor influencing this contraction is the persistently weak consumer purchasing power.

Economic Factors Contributing to Premium Decline

The company highlights that despite Indonesia's macroeconomic growth remaining stable at around 5%, various economic uncertainties and high banking interest rates have resulted in sluggish consumer spending and credit growth. This economic environment has directly impacted the life insurance sector, with premium income being particularly affected.

Business Strategy Amidst Challenges

In response to these challenges, Ciputra Life is focusing on several key strategies:

1. Product innovation to better meet customer needs
2. Developing new and existing business partnerships to expand market reach
3. Enhancing customer service for policyholders

The company remains optimistic that economic growth and consumer purchasing power will improve in the final quarter of 2025, potentially leading to higher premium income compared to previous quarters.

Financial Performance Overview

Ciputra Life recorded Rp365 billion in premium income by September 2025, representing 83% of the previous year's level for the same period. This translates to a 16.63% contraction in Q3 2025 premiums. However, the company managed to achieve a significant increase in comprehensive profit, rising to Rp77.8 billion from Rp37.7 billion in the previous year.

Product Mix and Market Trends

The company observed a notable shift in customer preferences from unit-linked insurance products (PAYDI) to traditional insurance products such as health and life insurance. This trend is seen as positive as it aligns with the fundamental protection purpose of insurance products.

Industry-Wide Trends

The contraction in life insurance premiums has been consistent over several months, with August 2025 seeing a 1.21% YoY decline (Rp117.51 trillion) and July 2025 experiencing a 0.84% YoY decrease (Rp103.42 trillion). This ongoing trend underscores the challenging environment faced by the life insurance industry in Indonesia during 2025.