Growth of Insurance Premiums Down

Growth in general insurance premiums are expected to fall due to global crisis. This is due to decreased customer growth, particularly from the corporate level. As a result, insurance companies must change the distribution and target customers.

This condition is not much different from the growth of insurance premiums nationally. Based on data from the Chairman of the Indonesian General Insurance Association, a national insurance premium growth in 2007 amounted to 13.59 percent, then rose in 2008 to 21.88 percent. In the year 2009,

Effects of corporate crisis also impacted on the growth of insurance premiums. Moreover, most customers come from general insurance company,
Due to the global crisis, the growth of insurance premiums in the period from January to May 2009 only reached 19 percent or lower than the premium growth in the previous year which reached 50 percent.

Tips for Choosing Life Insurance

Life insurance is one important requirement related to financial planning. In recent years, unit-linked products including life insurance category is increasingly growing and provides many offerings. We recommend that you carefully before an investment that also have this protection.

Choose products that provide space for customers to adapt to the needs and abilities. There is an enticing product, because only by setting aside 10 thousand dollars per day, you can pay a premium for protection and long-term investment. But not just cheap, you need to also examine the extent of adjustments that you can do.

For example, changing the benefits of investment, in this case increase, reduce or even eliminate the benefits of protection, adjusted for the amount of premium. Is then the premium will also increase or follow the previous premium, if the customer then make adjustments based benefits

We recommend that you select the insurance product by first discussing in detail the advantages and disadvantages. Professional insurance agent should provide a space for discussion and not just "sell"products.

The importance of insurance education

Functions, education insurance is for protection. Owners insurance is the father or mother who became the main breadwinner. Owners are required to pay insurance premiums in the amount and time suitable choice.

The advantage, the owner of the insurance will get funds every time the sons and daughters enter the new education, elementary, junior high school, and PT. In addition, insurance funds will still be given if the owner dies without paying premiums again. Instead the funds were taken before his time will be subject to penalties, required to pay a certain amount.

When did you start this insurance? We recommend that since an early age. You can start this insurance program since the children aged 0 years because the premium paid can be cheaper than if you take insurance when the child is older, the premium to be paid will be higher. Age children to a maximum of 12 years and old age people is also a factor to determine the degree of premium.

You then choose to contact the insurance. Then, based on your plan, the insurance company will calculate how much money is needed for each level of education. From there, it could be concluded how much premium to be paid every month. The insurance company also will calculate the funds available and the premium is determined.

For example, if your income is currently about 5 million per month, assuming 10% - was for the cost of our baby education insurance, amounting to 500 thousand rupiah per month, or about 6.5 million dollars per year

The difference between the Savings Insurance

Education savings accounts are generally sold by the bank, with backup by life insurance companies. So we can come to the banks who sold these educational savings, and we determine how much our target and how long the target would be achieved. Then the banks will determine how much monthly payment should be done with include the interest rate should be used during the contract period.

Generally, education savings is equipped with life insurance or other insurance. So when parents who experienced severe to deposit every month, such as dies, then the life insurance will replace him as the depositor. So the target of education fund established by parents who can still be enjoyed by children.

But Education Insurance generally purchased through an insurance company who offered by the agent. The customer will determine how much money after seeing the benefits of insurance coverage that will be paid. And insurance companies determine how much premiums that must be paid in a lump sum or on a regular basis, can be annual, can be six-monthly, quarterly and even monthly.

Insurance benefits which are generally offered a certain percentage of the sum insured and paid when the child would go to elementary, junior high school or college. And the benefits will still be paid even if the premium payer's parents as the unfortunate, for example, died.

Both education and insurance savings education both can be used as an alternative to prepare for the child's education fund. Education savings just to prepare at one point, for example, to enter elementary school, or junior high school.

If you want to complete such education insurance, then we have to buy 4 products of this education savings, with funds target and the achievement of different. But precisely here lies the flexibility of an education savings. Currently the interest rate of savings education refers to the deposit or slightly above the deposit which he sold, while the interest rate is more conservative education insurance.

There is one option which is recommended to break with insurance benefits and fertilizing the funds. Suppose we buy term life insurance with sum assured as targeted education funding and achievement of specified time. Then on a regular basis, you deposit a certain fund to invest one's way, for example, into mutual funds.

We also can choose an investment instrument which has a high rate of return and higher risk of course. So with this method, you can obtain a high sum of insurance and investment returns which optimal. The key is just one discipline.

Researching Insurance Policy

Below are some tips you can use to understand the policy that you have.

1. Make sure your contents insurance policy in accordance with which you agree in life insurance demand letter. This information can be found on the front page or a summary of the insurance policy. In this section, you can read the insurance product you buy, a large sum assured, start date coverage, the length of insurance period, large premium payment, also the name of the insured and the name of the policyholder.
2. Is there a clause "free look period." In the insurance policy with this clause, you as the policyholder by the insurance company given the opportunity to read the contents of the policy carefully. If the policy is issued is not to your liking, the policy can be returned to the insurer and the premium you have paid will be refunded.
3. Read Back the general provisions of the insurance policy carefully. In this section, you can read your rights and obligations as the holder of an insurance policy. For example, your obligation to pay the premium and what sanctions should be your responsibility due to late or unpaid premiums. The right to obtain insurance benefits when the insured risks.
   

• Also the rights and obligations of the insurer as the insurer. For example, company's obligation to pay claims filed by policyholders or beneficiaries. The company's right to enforce the automatic premium loan due to delays.
• There are also facilities free period or grace period. Free period given by the company to anticipate delays in payment of premiums. Insurance policy premiums are not paid after the due date for payment until the time limits freely, will still be covered if there is risk in that period. Long period of this flexibility is usually between 30 to 60 days.
• See also chapter on general provisions of the policy exclusions of this insurance. In part this exclusion, you can read some things that are excluded which resulted in unpaid benefits.
• Are there special provisions for the products you buy. Some insurance products have specific specifications that need to be set forth in a special provision. Suppose you purchase additional accident insurance products, special provisions for these products will be attached separately.
• Is a copy of the request life insurance attached. In general, a copy of this letter is attached in an insurance policy, because this life insurance demand letter is the basis for the issuance of insurance policies.

How do insurance companies calculate insurance premiums?

First, insurance companies apply the law of large numbers. His philosophy, the smaller the risk and uncertainty when the number of insured increased. The greater the number of people who enter the life insurance program, the accuracy of estimates of insurance losses more easily done. In this condition, the insurer is able to anticipate an insurance claim in the future more accurately. The bigger the group the insured, the losses experienced by the group that will be easier to predict.


For example, an insurance company PT will face a big risk when it should close the insurance coverage for one person $ 100 million for one year. When the number of people insured reaches 500 people, the level of uncertainty will decrease even though the risk of death events remain. If the 500,000 insured in one group, the average death rate fluctuations will decrease. Thus, life insurance companies are able to anticipate more accurately the insurance claim.

Secondly, life insurance companies calculate premiums based on mortality statistics in the table. It speaks about the level of mortality or mortality at any age level. This statistics table is a record of mortality is observed in the previous time period. From the observation result, insurance companies make an average figure as a benchmark for making illustrations of probability levels of life expectancy at each age group.

PT insurance using mortality tables as the main element in calculating insurance premiums. In addition, the calculation is based on the amount of administrative costs, distribution costs and interest rate assumptions. The amount of non-mortality of these elements depend on each company's policy of insurance.


In general, the determination of premium rates every life insurance company based on four principles, namely

• insurance premiums will be calculated by considering the amount of an insured group. The principle of average and probability can only work if applied to large groups. The larger a group the insured, the premium calculation closer to the expected results
•  although it is unknown when and how each group member will die later on, past experience is good enough to use as a guide to estimate future
• life insurance companies pay claims life insurance policies issued from the collection of funds contributed by the policyholders
• each participant contributed to the accumulation of funds in accordance with its risk level. People aged more will pay a higher premium rate than those aged younger.

By knowing how to calculate the premium, we should realize that an active awareness for insurance since very early to determine the amount of premiums we pay. Financial risk management is a form of our responsibility to the family. How wise is the transfer of financial risk to insurance companies by purchasing life insurance products. This is to reduce the financial burden in the future due to the emergence of misfortune / calamity and uncertainty. Do not delay a decision for insurance because of the disaster can never be predicted. Immediately contact the insurer or insurance agent that you know.