"Wellness" App, A New Approach to Getting to Know Insurance

Penetration of the life insurance industry was recorded at only 1,1% as of July 2020 according to OJK records. This issue continues to be a chronic obstacle that has not been managed optimally.

Insurance penetration is the ratio of the amount of funds in the insurance industry to gross domestic product (GDP). This means that the total assets of the insurance industry as of July 2020, worth IDR 515,78 trillion, only contributed 1,1% to GDP.

The level of insurance penetration must be viewed from two sides. Although the industry's contribution to the economy is still low, on the other hand, the opportunity for growth is still very large.

“Based on my experience as an insurance supervisor, the key to winning penetration is actually from the implementation side good corporate governance [GCG]," said OJK Deputy Director of Insurance Supervision II Kristianto Andi Handoko as quoted from Bisnis.com.

In 2018, OJK noted penetration of the insurance industry as a whole once reached 2,77% and in 2017 it was 2,84%. Until now, the insurance penetration rate has never reached 3%, let alone 5% as is always dreamed of by industry players.

In comparison, the insurance penetration rate in Singapore is in the range of 6-7%. Despite decreasing penetration, the level of awareness (awareness) public interest in life insurance products has increased since the corona virus pandemic.

The results of a survey by the Nielsen research institute quoted by the Indonesian Life Insurance Association (AAJI) revealed, awareness of having life insurance products in big cities in Indonesia it is 24%. However, this figure does not have a significant impact because life insurance premiums tend to fall to IDR 44,11 trillion in the first quarter of 2020 from IDR 46,4 trillion in the same period in the previous year.

This homework, which has been around for years, is actually the responsibility of all stakeholders, from policy makers to industry players themselves.

The presence of startups insurtech, as a technology partner of insurance companies, is a new way to accelerate insurance penetration. Together they create customized micro products that suit customer targets, so that consumers can transact on their favorite digital platforms at low prices, get simple protection, and carry out the claims process more easily.

"The more relevant it is to their needs, the more likely they [consumers] will buy the insurance product. For example, such as travel insurance, insurance handphone, logistics insurance, and so on," said Co-Founder and Qoala COO Tommy Martin, some time ago when he was a speaker at #TuesdayStartup.

He believes that insurance products will become insurance pintu beginning to increase insurance penetration in Indonesia. Out there, insurance solutions are much more complex and require help insurtech to overcome this with supporting technology.

The enthusiasm of buyers of insurance products during the pandemic was successfully summarized by the 2020 e-Conomy report compiled by Google, Temasek and Bain & Company. The report revealed that online insurance purchases soared by 30% in a year with a CAGR of $2 billion, supported by demand for life and health insurance products.

Industry wellness

On the other hand, this low penetration is also influenced by the stigma of "difficult to claim" because the product purchased is just a piece of paper containing an agreement that will be paid in case of illness or death. Paying claims is “moments of truth” create an insurance company and that's when they get to work.

Another approach for insurance to make it easier to accept is through industry wellness. In Asia, this industry began to attract attention from global insurance services to popularize healthy lifestyle programs in the early 2010s. The essence of this approach is to change the insurance company's relationship with customers, no longer transactional. This condition is supported by the trend of self-tracking with devices w, including marking the launch of the Apple watch in 2015.

In Singapore, Great Eastern Life became one of the pioneer companies in early 2012, then followed a year later by AIA to introduce the program wellness. The ambition is that the company wants to be involved in aspects of customers' lives every day to minimize the risk of illness and prolong life. These two aspects are very important for insurance.

Wellness: finally began to slowly be introduced in Indonesia through many channel. The momentum of the Covid-19 pandemic has also boosted this trend. Global insurance companies also want to get involved by bringing their applications here. They are Prudential and AIA.

Prudential made it official health app all-in-one Press which is supported by artificial intelligence to support users to manage their health proactively. Pulse was brought to Indonesia in February 2020 and was inaugurated nine months later.

Pulse was first present in Malaysia in 2019, then gradually rolled out to a number of countries in Asia, such as Cambodia, Hong Kong, Laos, Myanmar, the Philippines, Singapore, Taiwan, Thailand and Vietnam. Since its launch, this application has been downloaded more than 16 million times as of January 2021. Indonesians contributed more than 4,3 million as of November 11, 2020.

This figure is much higher than the number of Prudential customers in Indonesia, which reached more than 2 million people per year, since they first operated in 1995.

"Especially this year, Prudential emphasizes its commitment to expanding its role in society, not only providing protection, but also supporting its role in society, not only providing protection, but also supporting preventing and delaying disease getting worse," said President Director of Prudential Indonesia Jens Reisch.

Not wanting to be outdone, at the beginning of this year AIA made it official AIA Vitality in Indonesia after being present in eight Asia Pacific countries. Even though the features are not as rich as Pulse, the spirit conveyed by AIA is not much different. The important elements of health in everyday life are broken down into four pillars: Eat Well, Move Well, ThinkWelland Plan Well to achieve a healthier, longer and better life.

President Director of AIA Indonesia Sainthan Satyamoorthy explained, AIA Vitality is transforming the way companies run their insurance business with a share value model. This will be a breakthrough in the industry, changing the standards of how insurance companies provide relevant services and protection to the public.

"Through AIA Vitality, we want to be actively involved in improving the quality of life of our customers, not only helping them when facing difficult times but also motivating and appreciating every small change they make for a healthier lifestyle through rewards which we have prepared," he said at the inauguration entitled All Well Indonesia.

Apart from being equipped with smelling features wellness, both Pulse and AIA Vitality are also equipped with business models. Pulse has a subscription package because this application is not exclusive to Prudential customers only.

This package, which is priced at IDR 39.900 per month, contains various features, including Meal Planning, Food Journal, My Healthy Eating Goal, My Eye Dispensary & My Pulmonary Clinic, and a life insurance protection voucher whose value is equivalent to one month's premium.

Beyond that, users who do not subscribe can access free features, such as a BMI measurement tool, Facial Wrinkle Mirror, and Sports Activity Monitor that can be connected to the device w. Non-health features are also available, such as information and reminders about prayer times and Qibla direction.

The AI ​​technology in Pulse comes thanks to the company's global collaboration with Babylon, an AI healthtech startup from England. In Indonesia, Pulse is supported too Halodoc for features Telemedicine and buy medicine.

Different from Pulse, AIA Vitality is here specifically for AIA customers and is a complementary product for those who want to manage their health more proactively. AIA Vitality works in three stages: Know Your Health, Improve Your Healthand Enjoy the Rewards.

"AIA Vitality is a transformational movement that invites people to start making small changes, step by step, realistic steps to encourage long-term behavioral changes that result in healthier, longer, better lives," explained AIA Indonesia CMO Lim Chet Ming to DailySocial when contacted separately.

He explained that AIA customers can join AIA Vitality by paying IDR 50 thousand per month. This application contains health and fitness programs that can motivate customers to be active in improving their health and quality of life by providing Vitality Points and various benefits in the form of discounts, vouchers, from AIA partners who have joined, such as Garmin, Gojek, Fitbit, and Prodia.

Before completing the challenge, the previous customer needs to do self-assessment online to find out how healthy your body is. They can connect the activity tracking device with the AIA Vitality app and participate in various recommended challenges and earn points from there.

“Changing habits in life is a challenge in itself. AIA Vitality understands this and provides a cycle that will encourage efforts to change healthy living habits in the community to produce long-term behavior changes."

Lim said that the presence of AIA Vitality is proof that AIA remains relevant in the unprecedented global pandemic conditions. “Everyone, including our customers, is struggling to survive in the midst of the pandemic. So we need to ensure that the best defense we have is by prioritizing health and protection of life, as well as health."

Need regulatory support

Implementation of aspects wellness globally it is much more mature than in Indonesia. Talking about global potential, this industry is predicted to be worth $4,2 billion in 2017 with annual growth of 6,4% according to the Global Wellness Institute (GWI) report.

Topped DSResearch report “Wellness Market in Jakarta” 2019, shows that starting a healthy lifestyle in Indonesia is not something easy. Although knowledge and awareness looks promising, but the cost is still a burden for most people.

In developing countries like Indonesia, economic growth is the biggest driving factor for adapting culture wellness into everyday life.

The report also saw that medicines, healthy food and health supplements were products that were of interest to the public. There is also interest in joining as a fitness member. Even though attention to preventive measures to maintain health is getting better, society's focus is still on healing measures after illness.

"A high level of technology adoption, especially in the form of digital applications, can be a catalyst to encourage better knowledge and dissemination of health products or services in the region," the report wrote.

2018 Basic Health Research (Riskesdas) data published by BPS shows that the adult obesity rate in Indonesia has increased to 21,8%. Even though the level of health has a high influence on work productivity. Breakthroughs are needed, including health benefits by corporations, to encourage healthy urban living.

Regulatory support is needed to popularize it wellness to become better known. For example, in India, the local regulator (Insurance Regulatory and Development Authority of India/IRDAI) asked insurance companies to include features wellness and prevention into the policy clause. The hope is that policyholders will remain healthy, minimizing the possibility of falling ill and being hospitalized.

"The guidelines from IRDAI on including wellness and preventive features in health insurance is certainly a positive step forward for customers who can now proudly own their health insurance policies," said Gurdeep Singh Batra, Head of Retail Underwriting, Bajaj Allianz General Insurance, quoted from Financial express.

He said that this step was eagerly awaited by the industry because it could provide the necessary impetus for a health insurance product. “We can reward customers in various specified ways such as discounts on consultations or treatments, pharmacy, health diagnostics, vouchers that can be exchanged for health supplements and memberships. fitness, and others."

According to him, in the long term, insurance companies can make policy prices much more affordable with the program wellness This. In this way, more people can be protected by insurance.

Gurdeep says, “We can also provide discounts to customers if they follow the health criteria specified in the policy. Apart from encouraging more people to opt for health insurance, this step will also help them lead a healthy lifestyle.”

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