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Looking for Insurance? These are the criteria for a good performing insurance company


All insurance companies on average claim themselves the best. Several advantages were put forward by the insurance company to convince many people. It could be that what he put forward is different from everyone's views.

The criteria for well-performing insurance can be known from several benchmarks commonly used to make performance ratings for insurance companies. From there is compiled a list of well-performing insurance companies. 

Then what are the benchmarks, I see below?

1. RBC: How Healthy Are Insurance Companies?

Risk-Based Capital (RBC) is used to measure how financially secure an insurer is or how healthy an insurer is. The health or illness of the financial condition of the insurance company is reflected in the size or small of the RBC ratio. A healthy insurer usually has a large RBC ratio.

2. What is the Liquidity Ratio of the Insurance Company?

How capable the insurance company is to manage finances well and how capable it is to meet obligations such as debt depends on the liquidity ratio. The high liquidity ratio indicates that the financial condition is in good condition.

3. How Big is the Guarantee Fund to Protect Insurance Customers?

Quoted from the OJK, the Guarantee Fund is an insurance company asset that is used as the last guarantee to protect the interests of policyholders, insureds, or participants. Regarding this Guarantee Fund, there are already rules: Law No. 40 of 2014 and OJK Regulation No. 71 / POJK.05 / / 2016 concerning The Financial Health of Insurance Companies and Reinsurance Companies.

4. Investment/Technical Reserve Plus Debt Claims

Used to find out the company's ability to pay its obligations to the policyholder in the long term. The 100% figure is a benchmark for knowing investment/technical reserves plus debt claims. Equal to or more than 100% already belongs to the best category.

5. Fixed Assets/Own Capital

The extent of the efficiency of the insurance company can be known from the fixed assets of the insurance company. No more than 25% is the best number for a well-performing insurance company.

6. Changes in Gross Premiums

To find out the company's ability to maximize premiums, find out how the insurance company's gross premium changes. If the insurance company gets a score of 33% or more, the insurance company is categorized as the best insurance company.

7. Net Premium Income to Own Capital

How is the power of one's capital against one's dependents in an insurance company? Less or equal to 300% is the standard of the best insurance companies.

8. Net Investment Income against Average Investment

Find out whether the net investment income against the average investment is equal to or greater than the average investment interest rate or not. If it is equal or larger, it means that the insurance company is one of the best insurance companies.

9. Net Claim Expense Ratio

To find an insurance company performing well, the ratio of this one must be equal to or less than 100%.

10. Ratio of Profit (Loss) Before Tax to Average Own Capital

Used to measure the ability of own capital to make a profit, the best standard of which must be equal to or more than the average investment interest rate.

4 Things Can Also Be Used as a Measure

Sometimes prospective customers do not have enough time or knowledge to research data so they are quickly tempted by various attractive offers provided by the insurance company.

Well, to minimize unwanted things in choosing a car insurance company. 

The following are 4 criteria for a good car insurance company in addition to the above 10 criteria.

1. How Long Has the Insurance Company Been Established?

The length of the insurance company's establishment can be an easy indicator to research the performance of an insurance company. Car insurance companies that have only been established for less than a year or only one year are not certain about the future. Because the insurance business is a risky business. If you are not experienced, the company may experience bankruptcy.

2. Has a Good Reputation

A reputation cannot be established in a short time. Insurance companies with a good reputation on an ongoing basis need to maintain and improve their performance. To get a car insurance company that has a good reputation, you can search for information from various sources, be it from social media or people around you.

3. Has Many Partner Workshops

Partner workshops are the spearhead of car insurance services.  The more partner workshops, the better the service because the easier it is to reach vehicle owners. Customers will feel comfortable without fear when they want to travel.

With so many partner repair shops available, if unwanted things happen to your car on the road, you just have to call the relevant party and wait until the car repair is complete.

4. Affordable Premiums

A good insurance program doesn't have to be expensive. The good performance of the car insurance company can also be seen from the premiums offered. If you are careful, a good car insurance company can offer affordable and good-quality premiums.

Each company offers different premium prices. Adjust the premium offered to the budget you have. A good car insurance company will certainly help you get a suitable premium.

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