Another way to provide financial security for your spouse

I. Christianto Contributor Jakarta

As one of the most populated countries in the world, Indonesia has a prospective market for the life insurance industry.

Although the number of policyholders is low, more people are aware of the need to have insurance coverage for risks related to health, death and retirement.

Obtaining a life insurance policy is another way to provide financial security for your spouse and family after you die. It also would give you peace of mind.

Life insurance comes in different packages as insurance providers tend to make a variety of products to cater to customers from different market segments.

They basically consist of three categories: whole life insurance, term life insurance and universal life insurance. Whole life insurance, also known as traditional or permanent life insurance, offers a death benefit with a fixed premium from the start of coverage. In addition to death benefits, it also provides a cash value and is often linked to education insurance programs.

Term life insurance provides protection only for a limited period of time, and is usually used in accidental death policies or to pay off debts or other financial obligations.

Universal life insurance is more flexible as the insured can structure the premium payment according to his or her financial capabilities. This insurance policy is also often linked to an investment package.

Despite the low number of policyholders, the insurance industry has seen steady growth in Indonesia during the past several years. Data from the Indonesia Association of Life Insurance show the number of insured totals 12.5 percent of the total population, a significant increase from 1.5 percent 15 years ago. There are now more than 50 life insurance firms operating in Indonesia, hiring over 60,000 agents across the country.

The competition, however, remains tight. With over 50 life insurance agencies competing against one another, the current market is saturated.

In addition to life insurance packages, insurance companies also offer protection for a person's health. An insurance company will cover all medical expenses if the insured becomes sick or is injured in an accident. The benefits are generally part of the accidental death benefits provided by the insurance company.

Public relations manager of PT Asuransi Allianz Life Indonesia Siti Thajeb said her company offered several insurance packages specially designed for individual clients.

"We have a 'SmartLifestyle' product line, which consists of various products providing coverage for every stage of a person's life, say from the time one is born, to the start of a new job, going through the start of a family, until one reaches retirement," she said.

Siti said that the package was designed so that a customer could have complete protection from a single insurance company.

There are so many choices available for you to obtain life insurance packages but determining the best one is not easy. The best way to pick the best product is to seek the advice of professionals or at least from friends who have purchased the package you intend to buy.