Life Insurance In Indonesia Is Considered To Have A Big Market

Illustration. (Photo: Doc. Antara)

JAKARTA - PT Asuransi Allianz Life Indonesia (Allianz Life Indonesia) assesses that life insurance in Indonesia has a large market, along with the rapid economic growth of the middle class.

"Our head office and regional office see that Indonesia's market (market) is very potential, because its population reaches 270 million," said Allianz Life Director Bianto Surodj, quoted from Antara, Friday, March 15.

On the other hand, he sees the challenge, namely the low penetration of insurance which is still two percent of Indonesia's gross domestic product (GDP) in the midst of many other comparable countries whose penetration has reached double digits of GDP.

"So, we have a big potential, but the penetration is still small," said Bianto.

Thus, he continued, this phenomenon made Allianz Life Indonesia get a mandate from the Head Office of Allianz in Germany to spin off the sharia business unit (UUS) through PT Asuransi Allianz Life Syariah Indonesia.

"Actually, spin off is not cheap. Because, many things used to be done by one person, now because companies are different, even though they are done by many people. However, we believe the Indonesia market is large, of which 87 percent of the population is Muslim, if we look at it, it must spin off," said Bianto.

In the midst of low insurance penetration, he also saw that financial literacy in Indonesia was still low, in which the Financial Services Authority (OJK) recorded a financial literacy index of 49.6 percent and an financial inclusion of 85.1 percent in 2022.

"The literacy is still low, so apart from business problems, we also try to support OJK to always echo literacy issues, we also support it," said Bianto.

Allianz Life Indonesia posted a total revenue of IDR 15.93 trillion as of December 31, 2023, an increase of 21.9 percent year on year (yoy) compared to IDR 13.05 trillion in December 2022.

As of December 31, 2023, the company's profit after tax was recorded at IDR 213.04 billion, or a decrease compared to the previous IDR 325.39 billion in December 2022.

The company's total assets were recorded at IDR 36.7 trillion as of December 2023, with total liabilities borne at IDR 30 trillion and equity worth IDR 5.7 trillion.