PasarPolis Poised For Expansion

Indonesian online insurance marketplace PasarPolis is aiming to bring its services to other Southeast Asian countries such as the Philippines and Malaysia where it sees plenty of unrealized potential in its huge home market.

Founded in 2015 - PasarPolis, a so-called insurtech company based in Jakarta, offers products which are underwritten by larger insurance companies. Its investors include, SBI Investment, Xiaomi, Gojek and Tokopedia -- the latter two being the components of the merged ride-sharing and super app entity GoTo. Among PasarPolis' offerings are health and accident coverage for drivers and passengers using Gojek.

Indonesia - with a young and growing population of more than 270 million people, is the largest country in Southeast Asia and the fourth-biggest in the world. It's economy has been transformed in recent years through the emergence of local technology startups such as Bukalapak, Gojek and Tokopedia that have allowed consumers to access an array of services via smartphone.

Strategy - PasarPolis hopes to greatly simplify insurance in Indonesia and other Southeast Asian countries by offering full-stack digital insurance, meaning complete services from underwriting and pricing to sales, distribution and claim management. By automating the process, PasarPolis says it has reduced insurance costs to customers and created a convenient purchasing process and experience.

Traditional Distribution Channels - Insurance in Indonesia is still primarily sold through traditional channels such as agents and banks, and requires the filing of extensive paperwork. There is no efficient data-gathering system and process in Indonesia for the industry. This is a major problem resulting in high insurance premium, mis-selling and fraudulent claim. 

Digital Distribution - While PasarPolis still deploys agents, their primary distribution channel is through digital platforms like Gojek and Shopee, which allows them to reduce costs and slash premiums.

In Southeast Asia, insurance penetration tends to rise in tandem with a region's economic development, but the rate in Indonesia remains low compared to regional peers. According to data from Swiss Re Group, Indonesia's insurance penetration premiums stood at 1.6% of gross domestic product in 2021, far lower than Thailand's at 5.4% and Malaysia's at 5.3%.

90% of the people that bought insurance" from PasarPolis "are first-time consumers of insurance." PasarPolis says it issued over 500 million policies last year. The company's gross written premiums grew three times in 2022 from the previous year.