Life insurance - Indonesia | Statista Market Forecast

The Life insurance market market in Indonesia is projected to reach a market size (gross written premium) of IDR US$13.09bn in 2024.
The average spending per capita in the Life insurance market market is expected to amount to IDR US$46.77 in 2024.
Furthermore, the gross written premium is anticipated to exhibit an annual growth rate (CAGR 2024-2029) of -0.37%, resulting in a market volume of IDR US$12.84bn by 2029.
In comparison to other countries, the United States is expected to generate the highest gross written premium of US$1.3tn in 2024.
Indonesia's life insurance market is witnessing a surge in demand, driven by increasing middle-class population and growing awareness about financial security.

Definition:

Life insurance is a type of financial product that provides financial security for individuals and their families. In simple terms, when you buy a life insurance policy, you pay regular premiums to the insurance company. In return, if you were to pass away while the policy is in effect, your designated beneficiaries receive a lump sum payment, known as the death benefit, which can help them cover living expenses and financial needs. Life insurance is designed to provide peace of mind and support for loved ones in the event of the policyholder's death. Gross written premium (GWP) is the main indicator of the insurance market. It is the total amount of money that an insurance company collects from policyholders for their insurance coverage before deducting expenses or commissions.

Additional information:

The market contains the following KPIs: gross written premium aggregated for all countries and regions, gross written premium per capita, gross claim payments, loss ratio – calculated as gross claim payments divided by gross written premium, and the share of insureds in the total population for over 50 countries.

Death benefit insurance
Endowment insurance
Disability insurance
Dowry insurance
Birth insurance
Term life insurance
Whole life insurance
Universal life insurance
Burial insurance
Other types of life insurance

Health Insurance
All non-life insurance types
Reinsurance

Over the past few years, the Life insurance market in Indonesia has witnessed significant growth and development.

Customer preferences: Customers in Indonesia are increasingly seeking life insurance products that offer not only financial protection but also investment opportunities. This shift in preferences can be attributed to the rising awareness among consumers about the importance of long-term financial planning and the desire for comprehensive coverage.

Trends in the market: One prominent trend in the Indonesian life insurance market is the increasing popularity of unit-linked insurance products. These products combine life insurance coverage with investment options, allowing policyholders to potentially grow their wealth while being protected. This trend reflects a growing demand for more dynamic and flexible insurance solutions in the market.

Local special circumstances: The regulatory environment in Indonesia has played a significant role in shaping the life insurance market. The government has been actively promoting financial inclusion and insurance penetration in the country, which has led to a more conducive environment for insurance companies to expand their offerings. Additionally, the presence of a young and tech-savvy population in Indonesia has driven insurers to innovate and digitize their services to cater to the changing consumer preferences.

Underlying macroeconomic factors: The steady economic growth in Indonesia has bolstered the overall demand for life insurance products. As the middle class continues to expand and income levels rise, more individuals are looking to secure their financial future through life insurance coverage. Moreover, the low insurance penetration rate in the country indicates a significant growth potential for insurers to tap into the underserved market segments. Overall, the Life insurance market in Indonesia is undergoing a transformation driven by evolving customer preferences, market trends towards investment-linked products, supportive local circumstances, and favorable macroeconomic conditions.

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on gross written premium, gross written premium per capita, gross claim payments, loss ratio, and distribution channels.

Modeling approach / Market size:

Market sizes are determined by a Bottom-Up approach, based on a specific rationale for each market layer. As a basis for evaluating markets, we use industry associations, national statistic offices, and international organizations, such as OECD. Next we use relevant key market indicators and data from country-specific associations such as insurance consumer spending, gross domestic product, insurance - consumer price index (CPI), population growth. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. For example, exponential trend smoothing and HOLT-linear. The main drivers are insurance consumer spending and insurance - consumer price index (CPI).

Additional Notes:

The market is updated twice per year in case market dynamics change. The impact of the COVID-19 pandemic is considered at a country-specific level.

This report presents a comprehensive analysis and additional information on the Financial market, in a PDF format.

The biggest life insurance market globally is the United States, and it was almost twice as large as the second-biggest market, China. People take out life insurance to financially support their loved ones after their death. The payout is often used to cover funeral expenses, replace income earned by the deceased, or pay for children's education. It can be paid out in a lump sum or as an annuity, which is paid in regular installments for either a specified time or for the lifetime of the beneficiary. In 2022, the United States was the leading life insurance premium writing country, with a total value of life direct premiums written exceeding 600 billion U.S. dollars. The second and third-largest life insurance markets were China and the United Kingdom, respectively.