IS THE FINANCIAL PERFORMANCE OF INSURANCE COMPANIES LISTED IN IDX ABLE TO MAKE PROFITABILITY AFTER THE EXISTENCE OF BPJS?

Abstract

Public health insurance is very important to maintain and improve a person’s life quality. The existence of BPJS, Social Insurance Administration Organization which provides medical coverage program for Indonesians, influences insurance companies that have been selling health insurance products. This paper aims to conduct research on how is financial performance of insurance companies after BPJS is formed. This study will not compare how is the financial performance of insurance companies before and after the existence of BPJS. Rather, it will focus on the ability of insurance companies in making significant profit growth after the existence of BPJS. The financial ratios used are NPM for dependent variable, and DER, DAR, ROE and ROA for independent variable. They are used to analyze net profit margin of 10 insurance companies listed in Indonesia Stock Exchange in 2014-2018. This research uses purposive sampling method and panel data. This research uses panel least square with fixed effect and is used as an analysis tool t-test and F-test are used for hypothesis testing. The study indicates that the financial ratios are : DAR and ROE of insurance companies significantly influence NPM, then DER and ROA is not significant. Based on the results, it is concluded that with the existence of BPJS, financial performance in form of financial ratios of insurance companies reduce the ability of insurance companies to generate profits.

Keywords: DER, DAR, ROE, ROA, NPM, BPJS, Financial Performance