The Indonesian General Insurance Association (AAUI) has predicted that motor vehicle insurance business can record positive performance this year with growth of 5%.
AAUI has said that unaudited results show that motor insurance premiums amounted to IDR17.2 trillion (US$1.2 billion) in 2017. This represented growth of 4.5% over 2016 which saw motor premiums of IDR16.49 trillion.
Referring to data from the Indonesian Motorcycle Industry Association (AISI), motorcycle sales in February 2018 stood at 439,586 units, down 3.1% from the same month in 2017 which saw 453,763 units sold, according to a report by Kontan.
Meanwhile, data from the Association of Indonesian Automotive Industries (Gaikindo) showed that in February 2018, vehicle sales fell 1.5% year on year (yoy) nationwide. However, groiwth in the first two months of the year was 4.57% when compared to the end of 2017.
Encouraged by the growth of automobile sales in the first two months of this year, AAUI Executive Director Dody Achmad Sudiyar Dalimunthe said: “This will affect the big picture in the motor line because the total sum insured for four wheels is definitely bigger."
However, he added, the impact of motor vehicle sales on insurance premiums in the first quarter of this year should be studied further.
AISI expects motorcycle sales to be in the range of 5.8 million to 6.1 million units this year, higher than 2017's 5.8 million units. Meanwhile, Gaikindo targets sales of four-wheeled vehicles to reach 1.1 million this year, marginally higher than last year's sales of 1.08 million units.