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Indonesia's economic situation affects the general insurance industry premiums.

In 2018, economic growth


was recorded at 5.2% and in an upward trend compared to 2017. The insurance penetration ratio was still
low but increased steadily from year to year (in total 2.77%, while for general insurance 0.41%).

Premiums at the end of 2018 were recorded at IDR 186.54 trillion from life insurance and IDR 61.15 trillion
from general insurance and IDR 13.3 trillion in profits for life insurance and IDR 5.6 trillion for general
insurance. The insurance industry's total assets of IDR 1,209.6 trillion were dominated by life insurance
assets of IDR 520.6 trillion and general insurance assets of IDR 146.8 trillion.

In the first half of 2019, the Indonesian insurance industry posted a total premium of IDR 222.14 trillion, up
3% compared to the previous year for the same period, consisting of IDR 81.56 trillion in life insurance
premiums and IDR 40.13 trillion in general insurance premiums. General insurance itself grew significantly
at 20% compared to the same period last year.

As a characteristic of the financial services industry, insurance is a global industry that will be affected and
influence each other between regional and country regions. Not only business practices but also regulations.
There are at least four things that affect each other future insurance markets in the Asia Pacific, including
Indonesia.

First, middle-class growth and changes in regulations. Insurance penetration rates in developing Asia-Pacific
markets, including India, Indonesia, China, and Malaysia will rise. Changes to regulations in all regions will
open up the insurance market.

Second, distribution channels will use more digital. This makes the insurance distribution landscape change.
In all regions, especially those who are young and digitally active, are open to buying insurance from
newcomers, including those from outside the insurance industry.

Third, ecosystems begin to survive. This demand for ecosystem services has spurred new partnerships.
Fourth, opportunities for mergers and acquisitions (M&A) abound in developing markets. Acquirers have
conducted around USD 72 billion in M&A transactions related to insurance in the Asia Pacific in the past 5
years with many targeting agents and life insurance operators.

Meanwhile, in 2019, the life insurance industry began to spur digital services in an effort to boost business
performance. In addition, digital services are also able to increase customer convenience and satisfaction.

Especially for life insurance, agents are still needed in marketing insurance products. That is because the
level of public awareness of life insurance is still low. Even though they already have an application and
already have a website, the community still needs an explanation as to how it is the task of the agent.

The market outlook for Indonesia's life insurance premium growth grew 13% to IDR 243 trillion in 2020. The
general insurance premium growth of 10% to IDR 81 trillion in 2020.

The key to life insurance premium growth is supported by the low penetration of only 2.3% of gross domestic
income. Though high consumption and an increase in middle-class society. In addition to Islamic and micro
products still have a large market niche.
As for general insurance, it is supported by various policy packages such as disaster insurance, property
owned by state assets, and the ministry of marine and fisheries programs, as well as palm oil and coal export
insurance.

In addition, the World Bank predicts that the world economy will grow only 5.1% in 2020. Meanwhile, the
uncertain condition of the global economy due to international trade tensions will lead to the slowing down of
the Indonesian economy. Yet, the tensions are expected to gradually decline in 2020. Moreover, a decrease
in domestic political uncertainty will make the national real GDP growth to begin to increase gradually in
2020.

The data shown above indicated that life insurance still has the largest contribution to insurance premiums
in Indonesia. This shows that life insurance has a large market that can still contribute positively to the
Company's business. However, we can see a downward trend in the performance of the Indonesian
economy. Of course, this is a caution for all industry players.

KESIMPULAN

In term of market outlook, existing data shows that life insurance still has the largest contribution to insurance
premiums in Indonesia. Indonesia's life insurance premium is predicted to increase by 13% to IDR 243 trillion
in 2020; meanwhile the general insurance premium is predicted to increase by 10% to IDR 81 trillion in 2020.
Thus, the Company still has a positive prospect in the future.

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