Allianz upbeat on Indonesian prospects<\/p>\n
By Sylvia Gratia M. Nirang<\/p>\n
SINGAPORE (JP): Germany's Allianz AG, one of the world's
\nlargest insurance firms, remains a firm believer in Indonesia's
\ninsurance market prospects, despite the country's economic woes.<\/p>\n
Allianz Insurance Management Asia-Pacific chief executive
\nofficer Michael Diekmann said he believed the recession would be
\nshort-lived and that the Indonesian market would develop quickly
\nonce the economic difficulties were over.<\/p>\n
\"Four years ago, before the crisis started, Indonesia was seen
\nas the biggest potential market in the region, not only by
\nAllianz, but also by many other multinational companies.<\/p>\n
\"Unfortunately, Indonesia is the hardest hit by the economic
\ncrisis, and it probably will take a much longer time for
\nrecovery. But for us, Indonesia is really the market for the
\nlong-term. You have to be willing for long-term investment ...
\nafter several years it will pay off,\" Diekmann said here last
\nweek.<\/p>\n
Diekmann said Allianz had not reduced its investment in
\nIndonesia, despite the economic crisis.<\/p>\n
\"Our investment in Indonesia, even during the crisis, has been
\nincreased. We increased our shareholdings in general insurance
\nand life insurance; we also put in some additional capital. We
\neven developed new business segments in Indonesia, such as the
\nhealth business last year,\" he said.<\/p>\n
Allianz operates two companies in Indonesia: general insurance
\nfirm PT Allianz Utama Indonesia and life-insurance firm PT
\nAsuransi Allianz Life Indonesia.<\/p>\n
Established in 1989, PT Allianz Utama is one of the leading
\nforeign industrial insurers and covers large-scale public and
\nprivate sector investment projects.<\/p>\n
In 1996, Allianz entered the Indonesian life insurance market
\nby establishing PT Asuransi Allianz Aken Life. The company's name
\nwas officially changed to PT Asuransi Allianz Life Indonesia in
\nApril.<\/p>\n
Allianz Life has 29 branches throughout Indonesia, serving
\nabout 50,000 life insurance policy holders and 22,000 new
\ncustomers of its health plans.<\/p>\n
Allianz Utama's president Manfred Wittau said his company had
\npaid out some Rp 400 billion (US$57.14 million) in claims related
\nto the three-day eruption of vandalism and rioting in Jakarta and
\nother cities in the country in May 1998.<\/p>\n
Wittau said his company decided to pay riot claims two weeks
\nafter the rioting occurred on May 13, 14 and 15 last year, when
\nmost insurance firms in the country were still in the dark about
\nthe nature of the riots.<\/p>\n
He said immediate settlement of insurance claims related to
\nlast May's rioting would improve the insurance industry's image.<\/p>\n
\"It was time for us to promote the insurance business in
\nIndonesia. By delaying payment, you don't polish your image,
\nwhile at the same time, you lose money. Allianz is widely known
\nfor its commitment and reliable settlement.\"<\/p>\n
He said the name of Allianz could not be put in jeopardy by
\ndelaying claim payments or by not paying out at all.<\/p>\n
Wittau said the Indonesian Insurance Council at that time
\nstill considered the riots to be part of the political reform
\nprocess, and that damages caused were not covered by insurance.<\/p>\n
\"I myself at that time felt that the claims must be paid. I
\nbelieved that the unrest was not civil commotion, because I think
\npeople who ransacked supermarkets and others had no idea in mind
\nto topple the government.\"<\/p>\n
Most claims were settled within a week after individuals and
\ncompanies presented their claim documents to Allianz, he said.<\/p>\n
Wittau said the Allianz commitment had attracted more
\ncustomers to Allianz Utama.<\/p>\n
He said in 1998, the number of new customers increased by 50
\npercent. The premium volume increased by about 180 percent.<\/p>\n
\"By the first half of this year, the number of new customers
\ngrew 50 percent and the premium income volume increased by 90
\npercent. Customers clearly see our commitment and they like it.\"<\/p>\n
Wittau said Allianz Utama's sister company, PT Asuransi
\nAllianz Life Indonesia, had also enjoyed a premium increase of
\nabout 40 percent in the first half of this year.<\/p>\n
Asia-Pacific focus<\/p>\n
Diekmann says the company's long-standing commitment to the
\nregion is one of its strengths in Asia.<\/p>\n
Diekmann said that despite the crisis, the encouraging
\nparameters for the region had not changed. These included high
\nsavings rates, a growing middle-class (excluding Indonesia),
\nincreasing educational needs, the need for old age provisions and
\nthe funding of necessary infrastructure.<\/p>\n
Companies that will succeed in such challenging times are
\nthose that are forward looking, and ones which have the ability
\nto adapt their business strategies in response to market
\nconditions. Diekmann said Allianz was one of these companies.<\/p>\n
Long-lasting commitment alone will not help companies succeed
\nin these challenging times. Allianz also has a strong presence in
\nthe region, with enough reinsurance capacity and know-how in all
\nlines of the insurance business.<\/p>\n
Diekmann said one of Allianz's main strengths was that it
\nalways tried to be independent by avoiding links with influential
\npolitical parties in every country it operated in.<\/p>\n
\"Involvement with ruling parties in some countries may pave
\nour way to grow rapidly in the region, but we choose to avoid
\nsuch practices because we do not want to be dragged down when the
\nruling parties fall.\"<\/p>\n
Today, Allianz has offices in 17 countries throughout the
\nAsia-Pacific region. Singapore and Hong Kong were selected as the
\ncompany's regional centers to manage its operations. Singapore
\nhosts Allianz Insurance Management Asia Pacific, Allianz
\nReinsurance and Allianz Risk Management, while Hong Kong hosts
\nAllianz Asset Management.<\/p>\n
Allianz has subsidiaries and joint ventures in 10 Asian
\ncountries: Singapore, Indonesia, China, Japan, Philippines, South
\nKorea, Laos, Pakistan, India and Taiwan.<\/p>\n
Allianz has shareholdings in Malaysia, Brunei and Thailand. In
\naddition, the company has representative offices in Vietnam.<\/p>\n
The company recently entered the Taiwan market by establishing
\ntwo joint ventures with the giant President Group.<\/p>\n
Diekmann said Allianz has set targets to obtain a gross
\nwritten premium of 100 billion DM in 1999, an increase from 90.4
\nbillion DM last year.<\/p>\n
He said 1998 was a good year for Allianz: gross written
\npremium increased 19.6 percent to 90.4 billion DM, from 75.6
\nbillion DM in 1997, and net profit increased to 3.6 billion DM,
\nagainst 2.6 DM in 1997.<\/p>\n
Diekmann said the company's strategic goals in the Asia-
\nPacific region were to increase its brand awareness, develop its
\nposition as the leading industrial insurer, expand the life and
\nhealth business and extend its asset management activities.<\/p>\n
\"We are trying to further pursue our goal of substantially
\nincreasing the group's premium income from the Asia-Pacific area,
\nat least to reach 11 percent of the total premium income in 2005,
\nfrom seven percent in 1997.\"<\/p>\n
Established in Berlin in 1890, Allianz has grown into one of
\nthe world's largest insurance companies.<\/p>\n
Allianz now operates in over 68 countries around the globe and
\nemploys over 105,700 people in life, health, industrial,
\ncommercial and personal lines of insurance as well as asset
\nmanagement.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/allianz-upbeat-on-indonesian-prospects-1447893297",
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