Indonesian Credit Insurance Faces High Claims Ratio Amid Economic Challenges

Rising Claims and Economic Pressures

The Indonesian credit insurance industry experienced a significant increase in claims ratio, reaching 85.56% by October 2025. According to data from the Financial Services Authority (OJK), the total premium income for general insurance and reinsurance in the credit line was Rp 19.67 trillion, while claims paid amounted to Rp 16.83 trillion ¹

Factors Contributing to High Claims Ratio

The Chairman of the Indonesian General Insurance Association (AAUI), Budi Herawan, attributed the high claims ratio to the inherent characteristics of credit insurance products, which often have medium to long-term tenors. Additionally, the economic conditions that have not fully recovered have affected credit quality, alongside historical challenges in underwriting, premium pricing, and technical reserves ¹

Strategic Responses from Insurers

In response to these challenges, PT Asuransi Asei Indonesia has implemented several strategic measures. The company's CEO, Dody Dalimunthe, highlighted the strengthening of underwriting processes through stricter credit assessment criteria, including debtor profile quality, credit history, and collateral. Furthermore, Asei is adjusting premium rates according to risk profiles and employing more accurate actuarial models to determine appropriate premium tariffs ²

Implications for the Industry

The high claims ratio in credit insurance highlights the need for careful risk management and product pricing in the sector. As insurers continue to adapt their strategies to manage these risks, the industry is likely to see further developments in underwriting practices and risk assessment methodologies.