1. Market Research
  2. > Financial Services
  3. > Insurance Market Trends
  4. > Bancassurance in Indonesia: Life, Non-Life and Creditor Insurance

Bancassurance in Indonesia: Life, Non-Life and Creditor Insurance is a study and related PartnerBASE dataset examining the provision of life, non-life and creditor insurance by banks and other lending institutions in Indonesia.

Drawing on the results of a survey of 66 banking entities in Indonesia, the study verifies the percentage of organisations investigated that distribute each of the following 13 types of insurance: accident insurance, creditor insurance related to consumer finance, creditor insurance related to credit cards, creditor insurance related to mortgages, critical illness insurance, health / hospital cash plans, household insurance, income protection insurance, investment-related life insurance, medical expenses insurance, personal motor insurance, retirement savings, and risk life insurance.

For those banking entities that are active in one or more of these fields, the reports ascertain the operating models that they use to source the type of insurance in question (e.g. external, joint venture or captive underwriters) and the identity of the specific providers used. This information is then displayed in terms of the weighted share of partnerships of these providers, which takes into account the number of retail customers of the partner banking entities, thus highlighting those insurance companies that hold the distribution relationships that offer the most potential.

You may be able to use this report, plus the PartnerBASE dataset and market data annexes that accompany it, in one or more of the following ways:

- gain access to a source of information that provides a comprehensive overview of the provision of personal insurance products by all significant banking entities in Indonesia;

- identify partnership opportunities for the same personal insurance products that may arise either because a banking institution is not currently active or because there is scope for replacing an existing initiative;

- understand which underwriters and other product providers have been successful in establishing distribution relationships with the most important banking entities in Indonesia;

- assess how the evolving regulatory environment may open up or block opportunities for your organisation to sell through the bank distribution channel;

- appreciate the magnitude of the opportunity to sell personal insurance products through banks and other lending institutions in Indonesia.

Overall, in a market in which bancassurance claims a distribution share of over 40% in life insurance and over 10% in non-life insurance, across the 66 banks and other lending institutions researched in Indonesia, Finaccord’s research identified 277 bancassurance distribution initiatives for the various types of insurance investigated.

Table Of Contents

Bancassurance in Indonesia: Life, Non-Life and Creditor Insurance
Table of Contents

0 0 EXECUTIVE SUMMARY 1
1 0 INTRODUCTION 3
What is this report about? 3
Distribution partnerships with banks and other lending institutions constitute the focus of this report 3
Rationale 3
Bancassurance has become the most important distribution channel for life insurance in Indonesia 3
Methodology 4
Survey of banks and other lending institutions 4
Market data 4
Definitions 5
Investment-related life insurance 5
Retirement savings 5
Risk life insurance 5
Critical illness insurance 5
Income protection insurance 6
Accident insurance 6
Health / hospital cash plans 6
Medical expenses insurance 6
Personal motor insurance 6
Household insurance 7
Creditor insurance 7
Mortgages, consumer finance and credit cards 7
Weighted provider share of partnerships 7
Operating models 8
Abbreviations and exchange rates 9
PartnerBASE and market data annexe 9
Finaccord 9
2 0 MARKET BACKGROUND 12
Banks and other lending institutions covered 12
Economic background 12
Indonesia's economy benefits from a young population and rapid urbanisation 12
and has tended to recover swiftly from economic crises 12
…meaning that it is now well-positioned for further growth 13
Indonesia occupies a lowly position in the World Bank's Ease of Doing Business Index 13
Introduction to the banking sector 14
In terms of its total number of retail customers, Bank Rakyat Indonesia is the country's largest bank 14
…although Bank Tabungan Negara is the largest competitor in the mortgage lending sector 14
Four of the top 15 banking institutions are state-owned 14
A number of banking entities with foreign parents are active in the market 15
and there have been several important bank mergers in recent years 15
Introduction to bancassurance 15
Over 40% of life insurance premiums were distributed by banking institutions in 2012 15
… with many banks having modified their bancassurance strategies in recent years… 16
… through the establishment of captive insurance underwriters, mainly in the life insurance arena 16
A number of banks have set up joint venture underwriters with foreign insurance companies… 16
and competition among insurers for bancassurance partnerships is fierce 17
Many insurance products sold via banks are Sharia-compliant 17
Regulations stipulate that bancassurance activities can be carried out according to three models 17
… which naturally has a significant impact on the structure of the market 18
3 0 INVESTMENT-RELATED LIFE INSURANCE AND RETIREMENT SAVINGS 19
Insurance market size and growth 19
The market for investment-related life insurance has grown rapidly in recent years 19
although that for retirement savings products remains extremely small 19
Distribution share of banks 21
For investment-related life insurance, the distribution share of bancassurers is likely to exceed 50% 21
Bancassurance provision rates, operating models and partnerships 21
Investment-related life insurance 21
25 banks distribute investment-related life policies in one form or another 21
with Manulife claiming the highest weighted share of partnerships 21
… and with joint venture provider AXA Mandiri ranked second 21
AIA Financial is ranked third by weighted share as a result of three bancassurance partnerships 22
A significant number of banks do not yet sell any kind of investment-related life insurance 22
Retirement savings 24
Provision of retirement savings products is mostly limited to the larger banking networks 24
with eight product providers having established bank distribution ties in this field 24
Performance of key bancassurance underwriters 24
4 0 PROTECTION-RELATED LIFE INSURANCE 26
Insurance market size and growth 26
Protection-related life insurance grew by over 11% per annum in real terms between 2008 and 2012 26
Distribution share of banks 27
Bancassurance provision rates, operating models and partnerships 28
Risk life insurance 28
Close to one third of banking organisations investigated sell risk life insurance 28
with captive underwriter BRIngin Life ranked first by weighted share of partnerships 28
and Sun Life second 28
Panin Life is utilised as both a captive and external underwriter of risk life insurance 28
Ten banks collaborate with one or more external insurance providers in this field 28
Critical illness insurance 30
Several Indonesian banks sell critical illness insurance in a stand-alone format 30
Chartis is the most prominent external underwriter in this field thanks to one important tie 30
Income protection insurance 30
Income protection insurance is not commonly marketed by banking organisations in Indonesia 30
Performance of key bancassurance underwriters 33
The combined market share of key bancassurance underwriters has fluctuated in recent years 33
5 0 ACCIDENT AND HEALTH INSURANCE 34
Insurance market size and growth 34
The market for accident and health insurance was worth around USD 1 26 billion in 2012 34
although this type of cover is often added to life insurance policies rather than sold by itself 34
Distribution share of banks 35
Bancassurance provision rates, operating models and partnerships 35
Accident insurance 35
Ten Indonesian banks sell accident insurance in a stand-alone format 35
By weighted share of partnerships, Allianz is the largest non-captive competitor 35
CIMB Sun Life and Mega Life are the two joint venture underwriters present in this market 36
Medical expenses insurance 38
Cigna is the leading provider by weighted share of partnerships 38
in a market characterised by relatively few distribution initiatives 38
Health / hospital cash plans 40
Cigna's tie with BNI means that it is also the most prominent provider in this sphere 40
followed by AXA Mandiri and AIA Financial 40
with other providers restricted to a combined weighted share of partnerships of less than 20% 40
Performance of key bancassurance underwriters 42
Captive and joint venture life insurers have lost ground in accident insurance in recent years… 42
…but still account for close to 18% of premiums in the health insurance segment 42
6 0 PERSONAL MOTOR AND HOUSEHOLD INSURANCE 44
Insurance market size and growth 44
Personal motor insurance premiums are worth over four times household insurance premiums 44
and are also growing more rapidly 44
Distribution share of banks 45
Bancassurance provision rates, operating models and partnerships 46
Personal motor insurance 46
Over 60% of lending institutions researched have an arrangement for selling personal motor insurance 46
In a very fragmented market, Sinar Mas is ranked first by weighted share of partnerships 46
… followed by Adira Dinamika as a result of its two major partnerships 46
and by Allianz which is utilised by Bank Rakyat Indonesia plus three other banks 46
Household insurance 49
The provision rate for household insurance is slightly higher than that for personal motor insurance 49
The use of BRIngin General by its parent bank makes it the leader by weighted share of partnerships 49
with Tri Pakarta occupying second place by the same measure 49
Two captive providers are active in household insurance in addition to BRIngin General 49
Numerous underwriters compete for bank distribution mandates for household insurance 49
Performance of key bancassurance underwriters 52
Captive underwriters control around 20% of the total motor insurance market 52
but they are limited to a considerably smaller market share in property insurance 52
7 0 CREDITOR INSURANCE 54
Consumer lending market size and growth 54
Mortgage lending 54
The residential mortgage market is small but growing quickly 54
Non-mortgage lending 55
The value of total non-mortgage consumer lending balances is more than twice that of mortgage balances 55
Credit and other pay later cards 56
Credit and other pay later cards per capita edged up from 0 05 in 2008 to 0 06 in 2012 56
Creditor insurance provision rates, operating models and partnerships 58
Creditor insurance linked to mortgages 58
Only one of the 41 mortgage lending institutions does not have a related creditor insurance proposition 58
Captive and joint venture underwriters are largely dominant this market 58
…albeit Cigna has a prominent position in the market as an external underwriter 58
A very significant number of insurance providers have established bank distribution relationships 58
Creditor insurance linked to consumer finance 61
Over 80% of entities offering consumer finance have a scheme in place for loan payment protection cover 61
…with BRIingin Life leading the market once again by weighted share of partnerships 61
Mega Life is ranked third in this arena as a result of deals with a number of banks 61
Manulife entered into a ten-year strategic partnership with Bank Danamon in October 2011 61
Several lending institutions have no apparent scheme in place for this type of creditor insurance 61
Creditor insurance linked to credit cards 63
All credit card issuers promote related creditor insurance 63
AIA Financial, AXA Mandiri, Avrist and Cigna together hold a weighted share of partnerships of over 70% 63
Prudential maintains partnerships with three different credit card issuers 63
Creditor insurance risk coverage 65
Cover for unemployment has yet to be introduced to the Indonesian creditor insurance market 65
Creditor insurance market size, growth and forecast 66
The market for all forms of creditor insurance is growing rapidly in Indonesia 66
with demand for mortgage-related policies likely to grow most quickly up to 2016 66


LIST OF GRAPHICS / TABLES
0 0 EXECUTIVE SUMMARY 1
Overview of bancassurance provision rates for different types of insurance in Indonesia, 2012 2
1 0 INTRODUCTION 3
Banks and other lending institutions in Indonesia contacted by Finaccord, segmented by type 4
2 0 MARKET BACKGROUND 12
Key economic indicators for Indonesia, 2012 14
3 0 INVESTMENT-RELATED LIFE INSURANCE AND RETIREMENT SAVINGS 19
Gross written premiums for investment-related life insurance and retirement savings in Indonesia, 2008 to 2012 20
Gross written premiums for investment-related life insurance and retirement savings in Indonesia, 2008 to 2012 (data) 20
Bancassurance provision of investment-related life insurance in Indonesia, 2012: provision rate, operating models and weighted provider share of partnerships 23
Bancassurance provision of retirement savings in Indonesia, 2012: provision rate, operating models and weighted provider share of partnerships 25
4 0 PROTECTION-RELATED LIFE INSURANCE 26
Gross written premiums for protection-related life insurance in Indonesia, 2008 to 2012 26
Gross written premiums for protection-related life insurance in Indonesia, 2008 to 2012 (data) 27
Bancassurance provision of risk life insurance in Indonesia, 2012: provision rate, operating models and weighted provider share of partnerships 29
Bancassurance provision of critical illness insurance in Indonesia, 2012: provision rate, operating models and weighted provider share of partnerships 31
Bancassurance provision of income protection insurance in Indonesia, 2012: provision rate, operating models and weighted provider share of partnerships 32
Market share in total life insurance of key bancassurance underwriters in Indonesia, 2007 to 2011 33
5 0 ACCIDENT AND HEALTH INSURANCE 34
Gross written premiums for accident and health insurance in Indonesia, 2008 to 2012 34
Gross written premiums for accident and health insurance in Indonesia, 2008 to 2012 (data) 35
Bancassurance provision of accident insurance in Indonesia, 2012: provision rate, operating models and weighted provider share of partnerships 37
Bancassurance provision of medical expenses insurance in Indonesia, 2012: provision rate, operating models and weighted provider share of partnerships 39
Bancassurance provision of health / hospital cash plans in Indonesia, 2012: provision rate, operating models and weighted provider share of partnerships 41
Market share in accident insurance of key bancassurance underwriters in Indonesia, 2006 to 2010 42
Market share in health insurance of key bancassurance underwriters in Indonesia, 2006 to 2010 43
6 0 PERSONAL MOTOR AND HOUSEHOLD INSURANCE 44
Gross written premiums for personal motor and household insurance in Indonesia, 2008 to 2012 45
Gross written premiums for personal motor and household insurance in Indonesia, 2008 to 2012 (data) 45
Bancassurance provision of personal motor insurance in Indonesia, 2012: provision rate, operating models and weighted provider share of partnerships 48
Bancassurance provision of household insurance in Indonesia, 2012: provision rate, operating models and weighted provider share of partnerships 51
Market share in total motor insurance of key bancassurance underwriters in Indonesia, 2006 to 2010 52
Market share in total property insurance of key bancassurance underwriters in Indonesia, 2006 to 2010 53
7 0 CREDITOR INSURANCE 54
Residential mortgage lending balances outstanding in Indonesia (absolute and per capita), 2008 to 2012 54
Consumer non-mortgage lending balances outstanding in Indonesia (absolute and per capita), 2008 to 2012 55
Credit and other pay later cards issued and per capita in Indonesia, 2008 to 2012 56
Key data points for the consumer lending market in Indonesia, 2008 to 2012 57
Provision of creditor insurance linked to mortgages in Indonesia, 2012: provision rate, operating models and weighted provider share of partnerships 60
Provision of creditor insurance linked to consumer finance in Indonesia, 2012: provision rate, operating models and weighted provider share of partnerships 62
Provision of creditor insurance linked to credit cards in Indonesia, 2012: provision rate, operating models and weighted provider share of partnerships 64
Risk coverage of creditor insurance policies in Indonesia, segmented by type of underlying product, 2012 65
Creditor insurance gross written premiums in Indonesia, segmented by policy type, 2008, 2012 and 2016 66
Creditor insurance gross written premiums in Indonesia, segmented by cover type, 2008, 2012 and 2016 67
Creditor insurance gross written premiums in Indonesia, segmented by policy and cover type, 2008, 2012 and 2016 (data) 68

View This Report »

Get Industry Insights. Simply.

  • Latest reports & slideshows with insights from top research analysts
  • 24 Million searchable statistics with tables, figures & datasets
  • More than 10,000 trusted sources
24/7 Customer Support

Talk to Veronica

+1 718 514 2762

Purchase Reports From Reputable Market Research Publishers
Agriculture Bank Insurance Joint Stock Corporation - Company Capsule, Timetric

Agriculture Bank Insurance Joint Stock Corporation - Company Capsule, Timetric

  • $ 99
  • Industry report
  • August 2016
  • by Timetric

Synopsis Timetric's "Agriculture Bank Insurance Joint Stock Corporation - Company Capsule" contains in depth information and data about the company and its operations. The profile contains a company overview, ...

Personal Accident and Health Insurance in Colombia, Key Trends and Opportunities to 2020

Personal Accident and Health Insurance in Colombia, Key Trends and Opportunities to 2020

  • $ 1450
  • Industry report
  • November 2016
  • by Timetric

Synopsis Timetric’s 'Personal Accident and Health Insurance in Colombia Key Trends and Opportunities to 2020' report provides a detailed outlook by product category for the Colombian life insurance segment, ...

Non-Life Insurance in Colombia, Key Trends and Opportunities to 2020

Non-Life Insurance in Colombia, Key Trends and Opportunities to 2020

  • $ 1450
  • Industry report
  • November 2016
  • by Timetric

Synopsis Timetric’s 'Non-Life Insurance in Colombia Key Trends and Opportunities to 2020' report provides a detailed outlook by product category for the Colombian non-life insurance segment, and a comparison ...


ref:plp2013

Reportlinker.com © Copyright 2016. All rights reserved.

ReportLinker simplifies how Analysts and Decision Makers get industry data for their business.