Fitch Ratings has revised the outlook on PT Tugu Reasuransi Indonesia's (Tugure) National Insurer Financial Strength (IFS) Rating to Positive from Stable, affirming the rating at 'A+(idn)'. The rating agency said the revision reflects the Indonesian reinsurer's improved financial performance and stronger capital generation, which it expects to support the company's ability to meet higher equity requirements by the end of 2028.
Tugure’s net profit recovered to IDR110bn ($6.05m) in 2025 from a net loss of IDR36bn in 2024, supported by a stronger insurance service result, lower retrocession costs and higher investment income. Its insurance service result rose to IDR192bn from IDR9bn, while its combined ratio improved to 95% from 101%. Return on equity also increased to 7% from negative 2.5%. Fitch expects sustained underwriting profitability to support internal capital generation, although risks remain in Tugure’s property and credit insurance businesses.
Tugure’s equity increased by 8% to IDR1.5tn at the end of 2025, from restated equity of IDR1.4tn a year earlier. This exceeded the first phase of Indonesia’s higher equity requirements, which sets a minimum of IDR500bn by the end of 2026. The second phase will require Tugure to hold IDR2tn by the end of 2028. Fitch expects the reinsurer to meet the higher threshold, with less need for external capital raising than some of its rated peers. Its risk-based capital ratio also strengthened to 201% from 183%, remaining well above the regulatory minimum of 120%.
Fitch assessed Tugure’s company profile as Moderate, citing its position in Indonesia’s reinsurance sector, sound retrocession arrangements and conservative investment portfolio. The reinsurer held a 14% market share based on 2025 premiums, with property and credit insurance accounting for around 47% and 21% of premiums, respectively. More than 75% of its invested assets were held in fixed-income securities and time deposits, while its retrocessionaires had international-scale ratings of at least ‘A-’. Fitch said an upgrade could follow if Tugure meets the second-stage equity requirement and consistently maintains a non-life combined ratio below 100%. A prolonged combined ratio above 108%, or a weaker solvency position that undermines its ability to meet the capital threshold, could lead to negative rating action.