He added that another advantage is the better return on investment and investment placements can be switched based on the market value. The executive director of the Indonesian Association of Insurance Companies (AAJI), Stephen B Juwono, estimates that unit-linked products will grow 50 percent this year, amounting to Rp 32 trillion compared with Rp 21.5 trillion in 2009. “The growth is due to a number of improved economic indicators in the country,” he said.
Data recorded by AAJI indicate a 35.6 percent contribution of total insurance premium income for 2009 totaling Rp 60.24 trillion. This was an increase of 27.26 percent compared with the same period in 2008 amounting to Rp 47.33 trillion.
What is interesting is that most Indonesians are not insurance minded compared to the people of other countries. The current low market penetration signifies huge business and growth potential.
According to the president director of PT CIMB Sunlife, Vivien Kusumowardhani, as quoted by Bisnis Indonesia, Indonesia is one of the most promising countries in Asia for all kinds of insurance products due to the low market penetration. The country spends only about 3 percent of its gross domestic income on insurance while Malaysia spends more than 4.5 percent and Singapore spends even more at 7.5 percent. “The research conducted by Sun Life Financial in 2009 shows that 67 percent of the population now view insurance products as being more important,” he said. (Burhan Abe)
The Jakarta Post, Oktober 26, 2010
