Allianz Indonesia taps millennial agents and digitalisation to reach more customers
Of its 40,000 agents, 60% belong to the next generation—the younger, tech-savvy, and diverse workforce.
From Hospital Cash Plan products or daily compensation to the insured, to long-term protection, Allianz Indonesia offers a broad spectrum of insurance products that makes it think long and hard about reaching all customer segments and meeting their needs. So, it has come up with two strategies: millennial agents and digitalisation.
“The distribution of insurance products through agents is considered important because agents can comprehensively explain complicated insurance products,” Allianz Life Indonesia Business Director Bianto Surodjo told Insurance Asia.
On the other hand, digitalisation makes it easy for all customer segments to access their policies. “However, this is more appropriate to apply to simpler insurance products such as a monthly premium of IDR500,000 ($33.19) for health protection, or a Hospital Cash Plan which by nature is easier to access digitally,” said Bianto
He acknowledged that Indonesians in general have a lot more to learn about complex insurance products, so digital access to such information will not suffice.
The Financial Services Authority (OJK) noted that in the 2022 National Financial Literacy and Inclusion Survey, the financial literacy index in Indonesia was at 49.68% and the inclusion rate was 85.10%. There is a gap of 35.42% between the level of financial literacy and inclusion in Indonesia.
Right now, Allianz Indonesia protects more than 13 million insureds, a significant increase from the 10 million policyholders at the end of 2020.
Millennial agents attract their own
In terms of the distribution of insurance products, Allianz Indonesia is currently working with 15 banks and more than 40,000 agents, of which 60% are millennials and Gen Zs.
Distribution through millennial and Gen Z agents allows the firm to reach young customers in the same age groups. This move is particularly important, given that Indonesian society and spending are now dominated by millennials and Gen Zs.
“In the next five to ten years, the millennial generation will have a much larger spending portion than now. Because they are productive and quite established,” said Bianto.
The key to tapping them is their fellow millennials and Gen Zs. “Our experience is that millennial and Gen Z customers cannot be accessed by agents from the previous generation. Because the millennial generation and Gen Zs are more sophisticated, they understand world movements or things that are dynamic more quickly,” said Bianto.
Digitalisation, a key to success
Complementing the thrust in agent competence, Allianz Indonesia has employed digital innovations across pre-sales, sales, and post-sales processes to improve the distribution of products.
“Over the years, we have created an ecosystem for digital-based services that meet customer needs, from the process of submitting policies to claims,” said Bianto.
Allianz Indonesia owns such digital sales tools as Allianz Discover; Allianz eAZy Connect which allows customers to access all policy information and submit health insurance claims through an online portal; Allianz eAZy Payment to pay premiums online; and OptimAll which allows customers to buy health insurance online through the official company website.
“The more Indonesians have access to technology, such as smartphones, this is an opportunity for us to continue to provide digital innovation and convenient protection solutions for customers,” he said.
He said their digital services continue to show increasing usage, with online policy applications for life insurance accounting for nearly 100% of the total applications. E-policies accounted for 68% of the new ones issued; and as for online health insurance claims, more than 63% are resolved within 24 hours via digital means.
“This is also one of the keys to success for Allianz, where our market share increases or annual premium equivalent (APE) during the pandemic, from 5.6% in 2019 to 10.2% in 2022 with digitalisation,” he said.
These key strategies were adopted by Allianz Indonesia in order to face the economic challenges in 2023.
Volatility always shakes up the insurance industry and this year has its fair share of that, starting with the threat of a global recession, rising inflation in various countries, the aggressive increase in interest rates by The Fed, geopolitical conditions, and the potential for an economic slowdown. These conditions tend to make customers increasingly considerate of their expenses.
“However, we are optimistic, especially by looking at Indonesia’s economic condition which is still quite strong,” said Bianto.
In the midst of global economic challenges, the Indonesian Ministry of Finance conveyed Indonesia’s economic growth projections which are still positive, at 5% - 5.3% this year and controlled inflation by continuously anticipating commodity price movements and the availability of fuel supplies as well as ensuring the functioning of the state budget.
Citing controlled inflation and economic growth in a positive direction, he said: “We remain focused on providing protection and explaining the benefits to the community.”
Such an outlook by Allianz Indonesia runs consistent with OJK’s target of growth in life insurance and general insurance assets of 5%-7%.
Cyber Insurance Can’t Do it Alone