Tackling the underinsurance problem in Indonesia
Tackling the underinsurance problem in Indonesia
With 200+ million in population, Indonesia's insurance penetration is among the lowest at only 3,11%. How can we close this gap?
Stigmas about insurance
Stigmas about insurance
Indonesia's underinsurance is a risky business. Research says 30% of Indonesia's population doesn't know how to obtain insurance, while a quarter believes the price of insurance products is too steep for them.
There are more factors than lack of awareness and affordability that prevent Indonesians from getting insured. Some think it's a bureaucratic nightmare. The process is tedious, and the jargon is complex. This propels a stigma around insurance and fuels the belief that it's a fraud.
This begs the question: How can insurance companies raise insurance awareness in a country with fast digital adoption?
6 stigmas about insurance
6 stigmas about insurance
Waste of money as it give no direct benefit
Difficult claim process
No urge to getting insured
Afraid to get scammed
Overwhelming insurance premium to choose from
Confusing jargon
Imagining ideal insurance practice
Imagining ideal insurance practice
To gain a deeper understanding of the persisting insurance challenge, our research team held a series of group discussions with the customers. Here's the takeaway from those sessions about factors they deemed important when buying insurance:
Peace of mind
The relief of knowing that the insurance company is immune from bankruptcy.
Hassle-free claim submission and fast reimbursement
Effective claim and reimbursement process, so customers can get the financial assistance immediately.
Ability to transact online safely and simply
Straightforward product with a visible price quotation. Also, the assurance about personal data protection.
Secure and easy payment method
Ability to pay for policies easily and assurance about financial data protection.
Flexible policies
Freedom to refund policies within a certain time window. So customers don't feel defrauded.
Digital insurance for all
Digital insurance for all
The one way insurance companies can close the underinsurance gap in Indonesia is through digitalization. Building a platform by making it accessible, simple, and tailored to customers' needs will increase insurance awareness. It's not impossible. We're a country with high smartphone and internet fluency.
Check out our work for Simas Jiwa on digitalizing traditional life insurance.