Wanaartha eyes lower end of market

JAKARTA (JP): PT Asuransi Jiwa Adisarana Wanaartha plans to increase its share in the Indonesian life insurance market by targeting middle-to-lower income groups, with the help of PT Pos Indonesia and Bukopin Bank.

The company, also known as Wanaartha Life, signed separate agreements on Wednesday with state-owned PT Pos Indonesia and Bukopin Bank allowing it to use their extensive networks of branches in Indonesia through which customers could pay premiums.

President Evalina Fadil Pietruschka said during Wanaartha's 26th anniversary party at the Jakarta Hilton Hotel that the company will use Bukopin's network of automatic teller machines and Pos' postal money transfers for premium payments.

Using Pos' services will make it easier for policyholders who live away from city centers to pay their premiums, she said.

Pos Indonesia manager for business development, Mulyanto, said the agreement would enable Wanaartha to market its insurance packet coverage through Pos' outlets countrywide.

"Hopefully the scheme would be ready in July," he said.

Wanaartha said in a statement that its insurance market was targeted at people in the middle and lower economic circles, segments which had been ignored by larger companies.

The company's president commissioner, Wardono Saleh, said that with only 10 percent of Indonesia's population covered by insurance, the potential for growth remained very high.

In 1997, Indonesian insurance companies only collected $655 million in premium, or 0.3 percent of the gross domestic product. This pales in comparison to $4 billion (4.2 percent) in Singapore, $985 million (1 percent) in Malaysia, and $1.25 billion (0.8 percent) in Thailand, he said.

The increasing number of foreign insurance companies working with local companies also attested to the prospect, Wardono said.

Wanaartha raised Rp 18.8 billion ($2.2 million) gross premium earnings last year, compared with Rp 22.5 billion in 1995, before the economic crisis.

Its investments in 1999 increased to Rp 98.4 billion from Rp 33 billion in 1994, and income from investments reached Rp 22.2 billion last year compared to Rp 3.67 billion in 1994, but down from Rp 25.8 billion in 1998.

Operational income in 1999 totaled Rp 6 billion, down from Rp 7.8 billion in 1998.

Wanaartha has 68 sales offices across Indonesia. Policyholders as of March totaled 160,000. (10)