1、Market Overview of Insurance & Insurtech in Indonesia Kiki Ahmadi Author - Kiki Ahmadi 11-years experience in telco and digital industry in Indonesia. Bachelor degree in Information System - ITS Surabaya. Msc in Innovation Management - University of Manchester. LPDP Awardee - PK 63. Currently AVP Bu

2、siness Development in Amartha. Formerly in Corporate Strategy XL Axiata and Billing Engineer Celcom Axiata Email : - Blog : - Linkedin : Indonesia Insurance Industry Overview Gross written premium increase 2x in the last fi ve years. However growth slowed down this year. Only 2% percent of Indonesia

3、n population are policy holders. BPJS however claimed to cover 74% of population 20102015 125 295 2018 433 Est 2019 456 GWP in IDR Tn Life insurance contributes majority of total insurance market premium 2017 393 2.24 % 2.77 % 20142018 Insurance Penetration Policy Holder vs Population BPJS Policy Ho

4、lders (in Mio) 156 171 133 201420152016 Digital insurance and insurtech startups are on the rise following fi ntech trends Life InsuranceGeneral Insurance Term-life Whole-life Unitlink Endowment 83% Auto-Insurance Property Personal Accident Travel Aviation 16% Key Players Company Premiums (in IDR Tn

5、)4.14.13.32.52.3 Primary Products Property & Corporate Health Insurance Large Industry insurance (Marine, Energy, Aviation) Auto-insurance Oil & Gas Industry Insurance Auto & Property Insurance Company Premiums (in IDR Tn) 281110109 Primary Products Investment-link product (Unit Link)n/a Life Insura

6、nce Data from 2015 - KPMG Report General Insurance Offl ine agents are still primary distribution channel Agents (50%) Bancassurance (30%) Online Channel and Others (20%) Percentage of channel distribution in Indonesia insurance industry (% of total industry GWP) Insurance is still an offl ine servi

7、ces. Distribution is limited people who have access to insurance agents or bank accounts. Data from 2015 - KPMG Report Online channel is contributing in transactions but still miniscule in value Data from 2015 - KPMG Report Life insurance typically sold by agents due to the complexity and high-price

8、 of the product. Agents deliver the needs of consultation and premium customization. Recent surge in insurtech makes many people buy insurance online. However they mostly buy simple, one-time product such as fl ight, delivery or gadget insurance which have simple straightforward policy. Price is usu

9、ally very cheap as well. Online channel drive high-frequency, low-value transactions. Hence in terms of total market gross premium value, it will still likely contributed by life-insurance sold by agents. Insurtech is solving 3 major barriers of entry in accessing insurance AwarenessAccessAffordabil

10、ity Common barriers in conventional insurance User need to understand the concept of risk Need to have access to agentsExpensive Common product are complicated to understand Cumbersome purchase process (e.g need medical checkup for life insurance) Long commitment of payment Claim process often is a

11、mystery How insurtech solve these barrier Micro-insurance which cover very specifi c clause (e.g gadget, travel, fl ight) Online channel (website & app) Low price micro-insurance One-click instant claimIntegrated in other platforms (e-commerce & e-wallet) One-time payment Simple pricing (e.g Pay x g

12、et cover 10 x) Three types of business model in digital insurance Digital Insurance Principal Insurance Broker Insurance Comparison Services Licensed insurance companies. Regulated by POJK 05 /2016. Must be registered and licensed. Broker gets commission from principal for every premium sold. Must b

13、e registered to OJK. Comparison site gets revenue from by driving leads. Broker & Principal will pay leads fee for traffi c. Must be registered to OJK as broker or in fi ntech sandbox Revenue comes from premium sold. Profi tability measured by Combine Ratio (CoR) which is Loss + Expense / Earned pre

14、mium. Commission usually a percentage of sales which could be as high as 30% of premium sold. Leads fee usually is very small, can be fi xed amount or percentage of premium sold (1 to 5%). Description Revenue Model Companies Insurtech Startup - Pasar Polis Founded in 2015. Became prominent after off

15、ering auto-insurance to Gojek and Gocar drivers. In 2018, PasPol was invested by three unicorns : Gojek, Traveloka and Tokopedia. PasPol originally was a comparison site. But they pivoted into micro-insurance. Most of their services are integrated via third-party platforms. PasPol is also operated i

16、n Vietnam and Thailand (Gojek operations), with development offi ce in India Founder : Cleosent Randing Latest Funding : Series A - Undisclosed - Gojek, Traveloka, Tokopedia Services provided : Mostly are micro-insurance with simple buying process and instant claim Travel Insurance Auto Insurance -

17、Cars & Motorcycle Gadget insurance P2P Insurance Paspol also offers single claim platform to do instant claim : Platform Integrations : Gojek Traveloka Tokopedia Amartha JD.id Pegi-pegi Citilink Key Numbers : 2 mio policies written per day Pasar Polis x Gojek - Go Sure Flight Insurance Insurtech Sta

18、rtup - Qoala Insurance aggregator founded in 2018. Started specifi cally in travel and fl ight insurance but has been expanding to gadget, health and P2P lending insurance. Recently raised 1.5 million seed round, lead by Sequoia India (Surge). Qoala offer 3 value props : 1 day claim, no paperwork at

19、 all and seamless paying experience. Founder : Harshet Lunani, Tommy Martin Latest Funding : USD 1.5 Mio - Seed Round - Surge Services provided : Similar to PasPol. Travel Insurance Auto Insurance - Cars & Motorcycle Gadget insurance Micro-health insurance Platform Integrations : Tokopedia Pegipegi

20、MNC Travel Tokopedia x Qoala - Dengue Insurance Insurtech Startup - Fuse Pro Insurance agent application. User can register to sell variety of insurance products. The concept is similar to agent model apps such as Kudo or TruMoney but specifi c for insurance product. Agent get commision up to 30% fo

21、r every insurance sales. Commission is added in the app balance which can be cashed-out through bank accounts. Agents can also get loyalty points. Founder : Ivan Sunandar Latest Funding : Undisclosed Amount - Series A - EV Growth Services provided : Life Insurance Travel Insurance Auto Insurance - C

22、ars & Motorcycle Gadget insurance Health insurance Marine insurance Personal Accident Platform Integrations : Tokopedia Key Numbers : USD 10 Millions premium sales in FY 2019 Fuse Pro Agent Application Non-startup Digital Insurance Parent Company: Aegon Futuready is a digital insurance broker. Found

23、ed in 2015, they claimed that they are the fi rst online broker who have OJK license. Services provided : Travel Insurance Auto Insurance - Cars Health Insurance Life Insurance Parent Company: BCA JagaDiri is a digital insurtech company from BCA group. Services provided : Health Personal Accident Li

24、fe Teeth Auto Insurance Lifestyle Insurance Parent Company: Sinarmas Launched in 2015, SimasNet is a digital insurance spin-off from asuransi sinarmas. Services provided : Auto Insurance - Cars Home Insurance Travel Insurance Personal Accident Flight Insurance Pet Insurance Options for Insurance Pla

25、y Insurance Integration Offer contextual general / micro-insurance Life Insurance Planner Offer simple guiding tools to plan, compare and buy life insurance from multiple insurance partners Claim & Policy Center One-stop dashboard for all insurance bought in platform Life Insurance Planner Life Insu

26、rance is a complex product with long payment commitment. Sales are mostly driven by agents which incentivized to push the most profi table product regardless of customer needs. could develop feature to make life insurance purchase much easier. This fi t with positioning as personal fi nance assistan

27、t Ethos , pre-unicorn US startup, tackle this problem by providing 5 steps questionnaire before recommending options. Options can also be optimized. HealthIQ, Series D US startup, recommends life insurance product based on users healthy activities. To qualify for customized plans, user have to take

28、health knowledge test and submit proof of sport activities. Claim & Policy Dashboard With 2 previous features, users can buy multiple insurance policies. Integrated insurance dashboard is needed to make it easier to read policy, submit claim and repurchase insurance. All insurance aggregator have cl

29、aim dashboard. Development options can be API integration or just simply embed this in-app Comparison of Insurance Plays PlaysLife Insurance Planner Lifeplan Insurance Integration Claim & Policy Dashboard Revenue Model Commision for every successful written policies (%) Leads fee per transaction (fi

30、 xed amount) No direct revenue Recommended Partners Partner with aggregator will give variety of insurance options. Futuready is the only online aggregator which have life insurance If startups wants to get higher commission percentage, partner directly with principal which have digital arm (Jagadir

31、i, Simas) can be explored Qoala, Pasarpolis, Fuse are already integrated with unicorns for partnership like this hence all of them should be faster to integrate. All three aggregators also have ample variety of products. Qoala & Pasarpolis already has single claim dashboard webpage hence development

32、 can be much simpler (embed page in app). If startups is exploring with multiple partners, then each partners needs to have APIs for policy reading and claim process. Development obviously is more complex Summary Insurance penetration in Indonesia is still less than 2% of population. Market share of

33、 premiums are primarily contributed by life insurance with sales driven by agents. Three main barriers of accessing insurance in Indonesia. Awareness : product is often complex to understand. Access : Consumer need to have access to agents or have bank accounts. Affordability : Premiums are expensiv

34、e and need long payment commitment Insurtech drive insurance sales through simple-micro insurance product and integration with E-commerce platforms. Market leader so far is PasarPolis due to their integration with Gojek, Tokopedia and Traveloka. Insurance features could strengthen startup VP. Three

35、models are proposed : Life Insurance Planner, Integration with Lifeplan and Claim & Policy Dashboard. If aiming for faster time to market and offering variety of product, integration with aggregator such as PasPol is recommended. However if looking for higher revenue, direct integration with digital

36、 insurance principal such as Simas or Jagadiri is better. References 1.KPMG Insurance in Indonesia Report - https:/assets.kpmg/content/dam/kpmg/id/pdf/id-ksa-insurance-in-indonesia.pdf 2.Asosiasi Asuransi Umum Indonesia 2018 Report - http:/aaui.or.id/wp-content/uploads/2019/10/INDONESIA-MARKET-UPDAT

37、E-y-2018-2019.pdf 3.Jumlah peserta BPJS kesehatan 2018 - https:/databoks.katadata.co.id/datapublish/2018/05/16/berapa-jumlah-peserta-bpjs-kesehatan 4. Beritagar BPJS Kesehatan Infografi s - https:/beritagar.id/artikel/berita/mencari-jalan-keluar-ideal-dari-defi sit-bpjs-kesehatan 5.Digital Insurance

38、 in Indoneisa - https:/kr- 6.Massive Opportunity of Insurtech in Indonesia - 7.Three Indonesian tech unicorns unite to back digital insurance startup - 8.Gandeng PasarPolis, Gojek Masuk ke Bisnis Asuransi Online - https:/dailysocial.id/post/gojek-go-sure-pasarpolis-asuransi-online-insurtech 9.Indone

39、sia-based insurtech startup Fuse raises Series A funding from EV Growth - https:/e27.co/indonesia-based-insurtech-startup-fuse-raises-series-a-funding-from-ev-growth-to-multiply-presence-across- country-20191016/ 10.Unpacking Insurance Landscape 2018 - 11.Ethos Life Insurance - series-c-raise/#299e87f43e61 12.Penetrasi Asuransi Jiwa Rendah, Tak Sebanding Dengan Pertumbuhan Penduduk Indonesia - https:/www.pikiran- -penduduk-indonesia 13.InsurTech: Infrastructure for New Insurance - https:/assets.kpmg/content/dam/kpmg/cn/pdf/en/2019/07/insurance-technology.pdf