Personal Accident and Health Insurance in Indonesia, Trends and Opportunities to 2016: Inadequacy of Government Funded Health Insurance to Drive Growth by Timetric

VIEWS: 40 PAGES: 204

More Info
									Personal Accident and Health
Insurance in Indonesia, Trends
and Opportunities to 2016:
Inadequacy of Government
Funded Health Insurance to Drive
Growth
Market Intelligence Report

Reference code: IS0031MR

Published: February 2012




Timetric

John Carpenter House

7 Carmelite Street

London EC4Y 0BS

United Kingdom

Tel: +44 (0)20 7936 6400

Fax: +44 (0)20 7336 6813




                             www.timetric.com
 EXECUTIVE SUMMARY




1 Executive Summary
        In terms of total written premium, the personal accident and health insurance segment accounted for the
        third-largest share of the Indonesian insurance industry in 2011. Indonesia’s highly diversified
        geographical nature – the country consists of a large number of small islands – opens up tremendous
        opportunity for insurance companies. Continuing problems of instability and violence have also
        encouraged Indonesians to take personal accident and health insurance. Initiatives have been taken by
        the Indonesian government to supply universal health insurance to its population by 2014. This social
        security benefit is expected to provide affordable healthcare to the population living below the poverty
        line. However, one of the main challenges for the government funded health insurance is how the
        government will sustain the payment for ever increasing healthcare costs in the future under the universal
        health insurance plan. There are more than fifty private health insurance companies operating in
        Indonesia and the inadequacy of government funded social security health insurance is driving the
        private health insurance market. The Indonesian personal accident and health insurance industry grew
        from IDR3.83 trillion (US$0.4 billion) in 2007 to IDR9.71 trillion (US$1.0 billion) in 2011, registering a
        CAGR of 26.2%, backed by rising GDP, growing disposable income and government initiatives for health
        insurance.

        Growing Indonesian per capita annual disposable income to drive growth

        During the review period, until the recession in 2009, Indonesia experienced sustained economic growth
        with rising consumer incomes. The purchasing power of the Indonesian middle-class population also
        grew during the period: the country’s per capita annual disposable income (PCADI) increased from
        US$1,063.61 in 2006 to US$1,503.99 in 2010, and is estimated to reach US$2,090.38 by 2015. The
        rising disposable income, increasing healthcare costs and changing lifestyle patterns of the Indonesian
        population will lead to growth in sales of personal accident and health insurance policies.

        Insurance agencies lead the sales of personal accident and health insurance products

        Insurance agents remained the leading distribution channel for Indonesian personal accident and health
        insurance products, owing to their strong, country-wide networks which enabled insurance companies to
        expand their market share and customer reach. In 2011, insurance agencies accounted for 50.4% of the
        personal accident and health insurance written premium. Over the forecast period, agencies are
        expected to remain the dominant and fastest-growing distribution channels for personal accident and
        health insurance in Indonesia.

        Low penetration to drive growth

        The Indonesian personal accident and health insurance segment registered a CAGR of 26.2% during the
        review period. The market is expected to record high growth over the forecast period, driven by the
        country’s large population, and rising disposable incomes and healthcare expenditure, leading to
        increased demand for personal accident and health insurance products. The currently underdeveloped
        nature of the Indonesian personal accident and health insurance segment suggests that the growing
        demand for these products provides ample opportunities for existing companies and potential entrants.




Personal Accident and Health Insurance in Indonesia, Trends and Opportunities to 2016                              Page 2

© Timetric. This product is licensed and is not to be photocopied                                 Published: February 2012
 TABLE OF CONTENTS



TABLE OF CONTENTS

1      Executive Summary .............................................................................................................. 2
2      Introduction ......................................................................................................................... 12
    2.1 What is this Report About? ..............................................................................................................12
    2.2 Definitions .......................................................................................................................................12
    2.3 Methodology ...................................................................................................................................14
3      Indonesian Insurance Industry Attractiveness ................................................................. 16
    3.1 Insurance Industry Market Size, 2007–2016 ...................................................................................17
    3.2 Key Industry Trends and Drivers .....................................................................................................21
        3.2.1     Business drivers ....................................................................................................................................... 21
        3.2.2     Consumer drivers ..................................................................................................................................... 22
    3.3 Recent market developments ..........................................................................................................23
4      Personal Accident and Health Insurance Market Outlook ............................................... 24
    4.1 Personal Accident and Health Insurance Growth Prospects by Category ........................................25
        4.1.1     Personal accident category market size, 2007–2016 ............................................................................... 49
        4.1.2     Travel insurance category market size, 2007–2016 ................................................................................. 53
        4.1.3     Health insurance category market size, 2007–2016 ................................................................................ 57
        4.1.4     Non-life health insurance sub-category market size, 2007–2011 ............................................................ 60
        4.1.5     Life health insurance sub-category market size, 2007–2011 ................................................................... 64
5      Analysis by Distribution Channel ...................................................................................... 68
    5.1 Direct Marketing Channel Market Size, 2007–2016.........................................................................70
    5.2 Bancassurance Channel Market Size, 2007–2016 ..........................................................................78
    5.3 Agencies Channel Market Size, 2007–2016 ....................................................................................86
    5.4 Other Channels Market Size, 2007–2016 ........................................................................................94
6 Regulatory Policies ........................................................................................................... 102
7 Porter’s Five Forces Analysis – Indonesian Personal Accident and Health
Insurance Market ..................................................................................................................... 103
    7.1 Bargaining power of supplier: medium to high ...............................................................................103
    7.2 Bargaining power of buyer: medium ..............................................................................................104
    7.3 Barriers to entry: medium ..............................................................................................................104
    7.4 Intensity of rivalry: medium to high ................................................................................................104
    7.5 Threat of substitutes: low ..............................................................................................................104
8      Reinsurance Growth Dynamics and Challenges ............................................................ 105
    8.1 Reinsurance market size, 2007–2016 ...........................................................................................106
    8.2 Reinsurance market size by type of insurance, 2007–2016 ...........................................................110
9      Competitive Landscape and Strategic Insights .............................................................. 115
    9.1 Overview .......................................................................................................................................115
    9.2 Leading Companies in the Indonesian Personal Accident and Health Insurance Market ...............115


Personal Accident and Health Insurance in Indonesia, Trends and Opportunities to 2016                                                                               Page 3

© Timetric. This product is licensed and is not to be photocopied                                                                            Published: February 2012
 TABLE OF CONTENTS



  9.3 PT Asuransi Bangun Askrida – Company Overview ......................................................................117
      9.3.1      PT Asuransi Bangun Askrida – key facts ............................................................................................... 117
      9.3.2      PT Asuransi Bangun Askrida – main products ....................................................................................... 117
      9.3.3      PT Asuransi Bangun Askrida – main competitors .................................................................................. 117
      9.3.4      PT Asuransi Bangun Askrida – key employees ..................................................................................... 118
  9.4 PT Lippo General Insurance Tbk – Company Overview ................................................................119
      9.4.1      PT Lippo General Insurance Tbk – key facts ......................................................................................... 119
      9.4.2      PT Lippo General Insurance Tbk – main products ................................................................................. 119
      9.4.3      PT Lippo General Insurance Tbk – main competitors ............................................................................ 119
      9.4.4      PT Lippo General Insurance Tbk – key employees .......................................
								
To top