Monday, 10 August 2015
Insurance contribution against Economy
This
article describes the conditions and contribution glimpse of insurance
companies in the national economy. Changes in the external environment, in
particular economic variables will have an impact on insurance companies.
Economic growth as well as growth in people's income is a factor that can
influence the potential and prospects of the insurance industry. At the macro
level, the insurance company's performance will be affected from the decline in
activity or the economic development of a country. Some studies show the
relationship between the insurance industry and economic growth in one or
several countries.
Theoretically
the relationship between insurance development and economic growth are causal
relationship, but the critical question is which one is more powerful as a
major contributor? Or in other words, which are at the cause and effect.
Economic growth supports the growth of the insurance or insurance growth to
support economic growth? The answer requires in-depth analysis, which combines
theoretical and empirical perspectives. Theoretical standpoint means discusses
general insurance principles associated with the source and use of dana-
related to the mobilization of public funds in the form of premiums and the
management of these funds for investment purposes. The principle was
subsequently linked with the insurance position as a financial institution in
the mechanism of circular flow of income- a simple economic model that
describes the interconnectedness between economic operators.
In
2013 the total value of world premium in the amount of USD 4,640,941 million
consisting of life insurance premiums of USD 2,608,091 million and general
insurance premiums amounted to US $ 2,032,850 million. By using nominal values,
premiums decreased in 2013, but when adjusted for inflation, total premium
world showed growth of 1.4% for total, 0.7% for life insurance premiums and
2.3% for general insurance. ASEAN region experienced relatively higher growth
than the world average is 9.5% for total premiums, 10.1% for life insurance
premiums, and 8.1% for general insurance.
Indonesian
insurance penetration is still below the world average, Asia, and ASEAN.
Insurance penetration in Indonesia by 2.1 percent to total premium, while the
world average, Asia, and the third consecutive ASEAN amounted to 6.28%, 5.37%
and 3.35%. The position of the insurance density is also relatively the same
which is still below the world average. Premiums per capita Indonesia row of
USD 77 for a total premium, USD 59 for life insurance, and $ 18 for general
insurance. This value is still below Singapore, Malaysia, and
Thailand-spoken-also has reached USD 2388, USD 341 and USD 214 for the total
premium, but still above the Philippines and Vietnam amounted to USD 54 and USD
23. The low insurance density can be understood as the Indonesian population
greater. Indonesia still has a huge potential if relying on the potential of
the population, especially if supported by revenue growth.
