Indonesia Insurance Industry Report - 2016

  • ID: 3611463
  • Report
  • Region: Indonesia
  • 27 Pages
  • Emerging Markets Direct
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FY15 Proved to Be a Tough Year for the Economy With GDP Slowing to a Five-Year Low of 4.7%

FEATURED COMPANIES

  • PT Asuransi Bina Dana Tbk
  • PT Panin Insurance Tbk
  • MORE
This report profiles Indonesia’s insurance industry, discussing market trends through 2015 and outlook for 2016. The report also highlights leading players in the sector including PT Paninvest Tbk, PT Asuransi Bina Dana Arta Tbk and PT Asuransi Multi Artha Guna Tbk

FY15 proved to be a tough year for the economy with GDP slowing to a five-year low. However, the insurance sector was resilient even amidst the dipping economic growth. The new premium income in life insurance segment grew by a strong 17% y/y in 9MFY15. Non-life insurance gross premiums also saw a double-digit growth of 10% y/y in 9MFY15. However, the profitability of the sector took a hit with claims going up by 11% y/y in life insurance segment and by 34% in non-life insurance segments.

The penetration rate of insurance is low in Indonesia, merely 2.5% of GDP, and life insurance coverage in Indonesia is still low at around 20% of the country’s population. Consolidation within the industry will most likely gain momentum in order to strengthen market positions against bigger insurers. The recent ruling requiring larger minimum capital base for all players will force smaller players having problems raising capital internally to seek capital from external sources, such as M&As.

This would push for a transfer of experience and stronger capital base, which in turn will make small local insurers more competitive. As a country with the largest Muslim population in the world, Indonesia has an untapped sharia market. The sharia market will benefit from further growth through improved regulatory environment.

The outlook for the Indonesian insurance industry is promising. The country’s large population size, positive capital market trends and rising incomes will drive the growth in the sector.

Key Points:

- Indonesia had an average GDP growth rate of 5.9% during 2006-2012. However, FY15 proved to be a tough year for the economy with GDP slowing to a five-year low of 4.7%. Insurance sector also reflected the dip in the overall economy.

- After recording successive trade surpluses during 2008-11, the country recorded successive trade deficit during 2012-14. As a result, the Indonesian currency came under huge pressure and saw a significant depreciation.

- As of 2014, life insurance segment had the largest share of total premium in the insurance industry at 70%. Gross premium earned by the life insurance segment grew at a CAGR of 15% during 2007-14, while gross premium earned by the non-life and reinsurance segment grew at a CAGR of 16% during this period.

- During 2007-14, total premium earned by the insurance industry grew at a CAGR of 16%. However, insurance sector had to bear the brunt of the slower economic growth with premium growth rate falling to single digits during 2013-14. It again revived in 2015 recording a double-digit growth in 9MFY15.
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FEATURED COMPANIES

  • PT Asuransi Bina Dana Tbk
  • PT Panin Insurance Tbk
  • MORE
1. Industry Profile
1.1 Sector overview
1.2 Sector size
1.3 Sector performance
1.3.1 Premium earned
1.3.2 Claims incurred
1.3.3 Retention rate
1.3.4 Penetration

2. Market Trends and Outlook
2.1 Key economic indicators-Indonesia
2.2 Regulatory developments
2.3 Sharia market
2.4 Foreign ownership
2.5 Market outlook

3. Leading Players and Comparative Matrix
3.1 Leading players
3.1.1 PT Panin Insurance Tbk (PNIN)
3.1.2 PT Asuransi Bina Dana Tbk (ABDA)
3.1.3 PT Asuransi Multi Artha Guna Tbk (AMAG)
3.2 Comparative matrix
3.3 SWOT analysis

4. Tables and Charts
Table 1: Top M&A deals in insurance industry of Indonesia
Table 2: Key financial ratios of the leading players (FYE Dec14)
Table 3: Latest results of leading players (9MFY15)

Chart 1: Number of life insured individuals in Indonesia-All plans
Chart 2: Total assets of life insurance companies in Indonesia
Chart 3: Gross premiums earned by the Indonesian industry
Chart 4: Premium earned by the insurance industry by segments
Chart 5: Gross premiums earned by the Indonesian life insurance companies
Chart 6: Gross premiums earned by the Indonesian non-life insurance companies
Chart 7: Claims disbursed by the Indonesian industry
Chart 8: Claims incurred by insurance industry by segments
Chart 9: Claims incurred by the Indonesian life insurance companies
Chart 10: Claims incurred by the Indonesian non-life insurance companies
Chart 11: Insurance industry retention ratio
Chart 12: Quarterly GDP growth rate-Indonesia
Chart 13: Trade balance of Indonesia
Chart 14: Average monthly USD to IDR exchange
Chart 15: Government budget deficit
Chart 16: CPI Inflation-Indonesia
Chart 17: BI rate-Indonesia
Chart 18: Growth in sharia insurance premiums
Chart 19: Total assets of Panin Insurance
Chart 20: Net income of Panin Insurance
Chart 21: Profitability of Panin Insurance
Chart 22: Total assets of ABDA
Chart 23: Net revenues of ABDA
Chart 24: Profitability of ABDA
Chart 25: Total assets of AMAG
Chart 26: Net revenues of AMAG
Chart 27: Profitability of AMAG
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- PT Asuransi Bina Dana Tbk
- PT Asuransi Multi Artha Guna Tbk
- PT Panin Insurance Tbk
Note: Product cover images may vary from those shown
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