The life insurance industry’s premium income from Investment Linked Insurance Products (PAYDI) or unitlinks continues to show a decline.
Based on data from the Indonesian Life Insurance Association (AAJI), the life insurance industry’s premium income from unitlink products per quarter III-2024 was IDR 53.81 trillion.
“This value contracted 16.4%, compared to the same period last year which amounted to IDR 64.37 trillion,” said Chairman of the AAJI Management Board Budi Tampubolon in a press conference at the AAJI Office, Central Jakarta, Friday (29/11).
If examined, premium income from unitlink products per quarter III-2023 was also recorded to have decreased by 22.4%, compared to the achievement per quarter III-2022 which was IDR 82.91 trillion.
Even though premium income from unitlink products is still declining, Budi is optimistic that these products will continue to be popular with the public in the future.
“As the marketing system for unitlink products improves and the public becomes more educated, we believe that unitlink products will still be in demand among people who need this type of product or unitlink coverage,” said Budi.
Meanwhile, regarding the decrease in unitlinks which was recorded as not being too deep as of the third quarter of 2024, Budi said that this was triggered by the unitlink sales process which had changed a lot.
So, he said that in 2022, marketers will indeed need a long time to sell unit links. Thus, this causes unitlink sales to be hampered.
Along with the new regulations regarding unit links, Budi said that marketers can optimize sales. The sales must now be recorded, then the explanation must also be in the form of illustrations.
This is in accordance with the rules contained in OJK Regulation (POJK) Number 22 of 2023 concerning Consumer and Public Protection in the Financial Services Sector.
Now, the unitlink sales process can be minimized in time. Because marketers and customers are also used to unitlink explanations. “This will speed up the sales process so that it will have an impact on the growth of unitlink products,” he said.
Furthermore, Budi said that unitlink products contributed 40.68% to the total premium income of the life insurance industry as of the third quarter of 2024.
The total premium income for the life insurance industry was recorded at IDR 132.27 trillion. This value increased slightly by 0.2%, compared to the achievement per quarter III-2023 which was IDR 132.04 trillion.