Jasindo expands into oil and gas insurance market

BP-Migas, the country?s highest authority in upstream oil and gas sector, has appointed several local insurance companies including PT Jasindo, Asuransi Central Asia and Wahana Tata to tap into the oil and gas insurance market which is previously controlled by Pertamina?s insurance subsidiary PT Tugu Pratama, Bisnis Indonesia reported on Friday.

"Jasindo has been named to cover 20 percent of the risk, Asuransi Asia 4 percent, Wahana 7 percent while Tugu Pratama will continue to control the remainders," Jasindo?s director Mustafa Azhari said. According to him the deal would begin effective beginning January next year.

He said that the appointment of Jasindo as one of insurance companies allowed to cover oil and gas insurance market was expected to provide a major contribution to the company?s premium income which was projected to reach Rp 1.01 trillion next year.

The premium income generated from the oil and gas industry reached a total of about US$40 million last year. The amount is expected to further increase in line with the expansion of the industry.

Tugu Prama has controlled the oil and gas insurance market for years thanks to the domination of its parent company Pertamina in the oil and gas sector. The removal of Pertamina?s monopoly in the industry following the implementation of the new oil and gas law last year has, however, brought a negative impact on Tugu Pratama?s insurance operation in the industry.

BP-Migas which takes over Pertamina?s regulatory role in the oil and gas upstream activities has gradually opened the oil and gas insurance market to other national insurance companies. (*)