In Indonesia, there are many financial products in circulation. various financial products These can be divided into three categories: banking financial products; Non-bank financial products (IKNB) and capital market products (Khon Kaen).

Banking financial products such as demand deposits, MSME loans, mortgages, savings, fixed deposits, etc. The financial products of non-bank institutions can be even more diversified. since financing (leasing/multi-financing) online credit to insurance Capital market products include stocks, bonds, mutual funds and other securities.

as well as other industries The financial industry in Indonesia continues to innovate. This includes the creation of financial products through a “marriage” between them. Insurance and Investment. This product is called unit link.

What is unit link?

Unit Linked is one of the innovative insurance products. in unit linked products Insurance premiums deposited by customers are not held solely in the form of insurance. But it is also partially allocated for investment, especially investment in mutual funds.

Part of the insurance premium deposited by the client is sent by the insurance company to the investment management company for proper management. Thus, customers do not have to worry about investment management and do not have to be afraid of investments.

This product has many advantages, including:

  1. in a single premium payment The client receives two benefits at the same time: the benefit of preventing unwanted risks and the benefit of receiving investment returns.
  2. in terms of investment Clients do not need to worry about money management or risk thinking. Because part of this product is allocated to mutual funds. which, incidentally, are managed by skilled investment managers in their field.

The disadvantages of this product compared to conventional investment or insurance products are:

  1. There is a risk of impairment of the insurance value due to a decrease in investment value.
  2. Clients cannot independently track their investment allocation.
  3. There are hidden costs such as “acquisition fees” which the customer must understand.
  4. In general, this product cannot be claimed all the time. Because this product is generally intended for long-term insurance. and according to the insurance mechanism Claims can only be accepted if there is a risk specified in the insurance policy.
  5. Unit-linked insurance premiums are usually somewhat more expensive than normal insurance premiums.

Usually, this insurance product is an insurance type with a long period of 5-20 years, such as life or health insurance. So you need to be careful if you want to buy this insurance product.

Link unit type

Types of unit links can be divided into 3 types, which are according to the payment of premiums. according to investment allocation and according to investment objectives from premium payment Unit-linked insurance is also divided into 2 parts: unit-linked insurance premiums that are paid in installments. and unit-linked insurance premiums that are paid only once

from investment allocation These instruments are categorized into 4 funds based on outstanding mutual funds: Money Market, Unit Linked, Equities, Hybrids and Fixed Income. final link unit type (Investment objectives) are tailored to the needs of each client.

Does Unit Link Include Investment?

Unit-linked is an insurance product, not an investment product, firstly, because it is issued by an insurance company. Secondly, it is possible that the percentage of the premium used for investment is much less than the premium used for insurance. Therefore, customers should purchase this product for preventive purposes only. not focusing on seeking return on investment

Is unit linked better or is it a traditional investment?

To answer this question You can see your own preferences. You like paying one premium and getting double the benefits. Or do you prefer to manage your own investment funds?

You need to be careful when choosing insurance products or investments. Because there is no guarantee or products in the capital market, such as deposit products guaranteed by the Deposit Insurance Agency (LPS), which means that If your investment loses or your insurance company goes bankrupt. You will not be compensated.

Don’t buy link units?

instead of not buying this product. You should buy link units with caution. Here’s what you need to do to choose the best quality link unit:

  1. aim. As mentioned above Unit-linked products are also divided into several categories according to allocation. Each type has potential risks and rewards. Make sure what your goals are and choose products that meet those goals.
  2. Understand the concept, risks and potential benefits of each product.Keep in mind that the concept of investment is very different from insurance, so to get the most out of such a “marriage” product, you must first understand what investment and insurance are. what is the product What advantages and disadvantages are there? and so on.
  3. Read the policy carefully. And if necessary, ask the agent directly. This is important. This does not rule out the possibility that the representative’s description differs from the description in the policy. And it’s important because you need to understand the concepts, risks and benefits of two different financial products. It should also be understood that although their job is to help clients and prospective clients. But agents are employees who are considered successful if they can attract potential clients to use the company’s services.
  4. Choose insurance from the best insurance company.Again, insurance is not a financial product that is guaranteed like deposits. Therefore, you should choose the insurance products offered by the best companies. Whether it’s a bank with an insurance product line or a direct insurance company. This is essential in order for your funds to be entrusted to a truly decent and trusted company.

So how do you find the best insurance company? First let’s look at the legal side. Make sure the company is legal from OJK. Second, look at their profile and work history. Simply put, the higher the asset value of a company involved in the financial industry. Third, be sure to compare the company’s history and products with those of other insurance providers.


Unit linked insurance does not include investment products. Although some of the premium products are passed on to investment managers to manage in the mutual funds they are issued. This product is not only Insurance coverage benefits Even though it is a long-term investment, there are downsides to consider as well. Carefully select insurance products and investments to maximize benefits, coverage and benefits.


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