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Indonesian insurer expects double-digit growth, expands operations
Publication Date : 21-05-2014
PT Asuransi Cigna, the local arm of US-based insurer Cigna, is expecting steady growth this year as people become increasingly aware of the importance of insurance, following the government’s introduction of the universal healthcare program earlier this year.
The insurance company also plans to roll out several new products this year to cater to people’s needs.
Asuransi Cigna’s deputy country manager, Julian Mengual, said at a press conference on Tuesday that he expected the company’s premium income to grow by over 10 per cent this year.
Last year, the insurer saw 17 per cent premium growth to 1.03 trillion rupiah (US$89.6 million) from 878 billion rupiah in 2012. It also posted 35 per cent growth in sales.
In the first quarter of this year, Asuransi Cigna’s premium income grew by 25 per cent compared to the same period last year, according to Mengual.
“I think last year’s growth was very much driven by the growing middle class, while this year it will be driven by the rise of people’s awareness of [the importance of] insurance with the launch of the universal healthcare program by the government,” he said.
While Indonesians’ awareness about insurance was rising, insurance penetration in the country stayed low at around 1.2 per cent of its gross domestic product (GDP), according to Williem Hoesen, vice president of Client Market Medical Insurance-Asia Swiss Re.
“This situation isn’t necessarily bad; it is a very good opportunity for insurance companies operating in the country,” he said.
Quoting a recent survey conducted by Swiss Re in six major countries across Asia, Williem said as much as 29 per cent of Indonesians had expressed their willingness to purchase insurance in the near future, while another 44 per cent had already thought about buying.
These figures surpassed those of Thailand, with 28 per cent and 40 per cent, respectively, he said.
In addition, Mengual said, to attract more customers in Indonesia, Asuransi Cigna would be launching three new products and one special product in the second half of 2014.
“We have one [product] that focuses on the mass segment, and we have two that focus more on critical illness,” he said.
Mengual said that Cigna would also launch another new product specially dedicated to Indonesian consumers during the fasting month of Ramadhan, with premiums set at between 10,000 and 100,000 rupiah.
He said he was upbeat that the products would be significant contributors to his firm’s business; in similar fashion to the launch of the firm’s previous product, Family Eazicare, which helped boost its sales by up to 25 per cent last year.
Mengual said besides planning the launch of new products, Cigna would also be expanding its operations to second-tier cities nationwide.
“We’re looking at cities like Yogyakarta right now. We haven’t fully decided yet, but our intention is to find potential cities and place people,” he said.
Asuransi Cigna currently operates in several major cities in the country, namely Jakarta; Medan, North Sumatra; Surabaya, East Java; Bandung, West Java; and Semarang, Central Java.
The firm’s parent company, Cigna, is among the top-five health insurance companies in the US with more than 11 million insurers. However, Asuransi Cigna is more low-profile in Indonesia, with greater focus on branding, face-to-face meetings and telemarketing to distribute its products.
*US$1 = 11,502 rupiah