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Jakarta Post

Most infrastructure financing options still unfit for insurance companies

  • Riska Rahman and Riza Roidila Mufti

    The Jakarta Post

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Jakarta   /   Thu, December 5, 2019   /  01:59 pm
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Fix it fast: Several technicians of state-owned electricity company PLN replace a damaged isolator in Jakarta. The construction of new power plants is an important part of the government's infrastructure development program.(The Jakarta Post/Dhoni Setiawan)

Many insurance companies have shown interest in taking part in financing the country’s infrastructure projects, but challenges remain as the country’s capital market lacks the appropriate instruments that fit their investment requirements. Indonesian life insurers association (AAJI) chairman Budi Tampubolon said that of the industry’s total assets of about Rp 550 trillion last year, about Rp 460 trillion was allocated for investment. “We have a lot of funds that could be managed and invested in infrastructure projects,” he said in a business forum in Jakarta on Tuesday. Many insurance companies are eager to put money into infrastructure because it usually provides long-term investment opportunities with lucrative returns and manageable risks, he said, but existing investment instruments mostly did not fit the insurance industry’s investment crite...