Insurance
From The Report: Indonesia 2020
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Indonesia’s insurance sector holds considerable potential, given the country’s current low penetration rate, large domestic population and growing middle class. While the industry suffered a setback in early 2020 when allegations of a “pump-and-dump” scheme involving investment funds managed by two state-owned insurers came to light, the strong and immediate regulatory response should restore confidence in the market. It is also an opportunity for other insurers that have demonstrated sound management of customer premium to differentiate themselves. Meanwhile, rapid advancements in the country’s digital economy are helping to increase financial literacy and provide new distribution channels to reach Indonesia’s fast-growing consumer class.

Articles from this Chapter

Overview

Vast potential: Efforts are under way to boost coverage among untapped segments of the country’s large population
OBG
plus

Indonesia’s insurance sector holds considerable potential, given the country’s current low penetration rate, large domestic population and growing middle class. While the industry suffered a setback in early 2020 when allegations of a “pump-and-dump” scheme involving investment funds managed by two state-owned insurers came to light, the strong and immediate regulatory response should restore confidence in the market. It is also an opportunity for other insurers that have demonstrated…

Analysis

Banking on growth: Bancassurance remains a strong and trusted segment, while digital developments provide new avenues for sector growth
OBG
plus

Bancassurance has emerged as a high-growth segment for insurance sales in recent years, as banks seek new revenue sources and diversification of their customer portfolios. In January 2019 the Indonesia Life Insurance Association (AAJI) forecast that total life insurance premium generated through the bancassurance channel would grow by 15-30% that year, based on the proliferation of partnerships between life insurers and banks, and a deepening product portfolio. AAJI said that as of September…