PT KB Insurance Indonesia has maintained a significant reliance on reinsurance, with a premium retention rate averaging 27% over the past three years, increasing to 31% in 2023. This figure remains lower than the industry average. However, Fitch Ratings anticipates a gradual rise in this rate as the company shifts its focus towards motor insurance offerings.
The insurer’s profile is evaluated as moderate, with a satisfactory capital buffer despite its heavy dependence on reinsurance. Fitch’s rating highlights the stable financial performance and conservative investment strategy of KB Insurance Indonesia.
KB Insurance Indonesia gains substantial benefits from being a key subsidiary of South Korea’s KB Insurance. The affiliation provides the Indonesian arm with strong brand recognition and operational synergies, despite its smaller scale in comparison to the parent company. In 2023, about 18% of its total gross premiums were generated from the KB group.
Fitch assesses KB Insurance Indonesia’s company profile as moderate, backed by a robust business presence in property insurance (accounting for 58% of 2023 premiums) and motor vehicle insurance (22%).
The insurer maintains a satisfactory regulatory capital position, though its risk-based capital ratio declined to 356% by the end of 2023 due to business expansion. Profitability has remained stable, with a combined ratio of 77% in 2023 and a consistent return on equity averaging 6% over the past three years.
KB Insurance Indonesia adheres to a conservative investment approach, with 90% of its assets allocated to cash, equivalents, and fixed-income securities, primarily government bonds.
