Indonesia's Insurance Industry Penetration Remains Low: Here's the Data

A video confession of several women earning up to Rp1 billion (approximately US$66,000) per month in the insurance industry has gone viral on social media. This income is considered fantastic, especially amidst reports of several insurance companies suffering losses.

According to the Indonesian General Insurance Association (AAUI), the penetration and density of the insurance industry in Indonesia remain low despite a population of 260 million and a growing middle class.

Insurance penetration refers to the insurance industry's funds compared to the Gross Domestic Product (GDP), while insurance density measures the average income portion allocated to insurance products annually.

AAUI recorded Indonesia's insurance industry penetration at 3.06% of GDP in 2021. This figure is down from 3.23% the previous year.

Meanwhile, data from the Central Statistics Agency (BPS) shows 149 insurance companies in 2021. The majority are general insurance companies, with 77 companies (51.68% of the total).

Next, there are 60 life insurance companies (40.27%), 7 reinsurance companies (4.7%), 3 mandatory insurance providers (2.01%), and 2 social security administering bodies (1.34%).

Furthermore, there were 223 supporting insurance companies in 2021. This includes 155 insurance brokers, 41 reinsurance brokers, and 27 loss adjusters.

(read: BPK Findings: Taspen Has Yet to Pay Rp42 Billion in Claims)