Life insurance coverage in Indonesia is said
to have risen by 15.1 percent year-on-year (YOY) in Q1 2012,
according to a media report citing the Association of Indonesian
Life Insurance Companies (AAJI).

The Jakarta Post, reported that this means
that the number of Indonesian consumers taking out life insurance
coverage reached 52.8m.

It added that individual and corporate markets
accounted for 9.73 m and 43.03m policy holders respectively.

AAJI chairman Hendrisman Rahim was reported as
saying that the increase in coverage reflects a higher interest in
life insurance among Indonesians.

Rahim was quoted as saying “More and more
people have realised the importance of owning a life insurance
policy as a long-term security measure. Indonesia’s positive
economic growth, despite the global crises, also plays a role in
this figure because people’s buying power has also increased. Right
now, traditional premiums dominate the market.”

Growth expected

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By GlobalData

Hendrisman was reported as saying that the
association expects a 30 percent growth in total revenues by the
end of 2012.

AAJI co-chairman of operations and
administration, Eddy K.A. Berutu, reportedly said that insurance
companies would try to cover more people on low incomes by offering
micro insurance policies for future customers.

Berutu was quoted as saying: “The premium will
be adjusted to these people’s income so that they can afford to
take out life insurance.” 

Berutu reportedly added that AAJI members also planned to increase
the number of licensed insurance agents in order to expand their
operations and reach the growth target.

“We are targeting 500,000 licensed insurance agents by 2014. Until
March 2012, there were more than 274,000 agents operating in
Indonesia. Last year we had about 220,000 agents. The number is
still low for Indonesia’s population,” Berutu reportedly said.