After providing Sharia life and general insurance for more than a year, Allianz Indonesia is very optimistic of its Sharia division. The year 2006 has shown great results.
Having extensive experience of more than 100 years as an insurer, Allianz SE has established itself as one of the largest and most renowned financial services provider in the world. In its commitment to be a leader of insurance providers, Allianz has expanded its range of products by offering Sharia products.
In the Islamic communities, most devout Moslems, tend to be attracted to the Sharia-linked financial products based on the Islamic principle of mutual help, i.e. based on real and ethically clean enterprises
Driven by the customer demand and the great potential of market, Allianz has also launched products using the Sharia principle. As of today, Allianz Sharia products are being sold in Saudi Arabia, and Bahrain to follow later this year. As the first Allianz unit in the Asian region, Allianz Life Indonesia started its sharia sales in April 2006. At the end of 2006, the production resulted in 2,230 policies and IDR 15,8 billion, more than doubling the target in terms of number of policies and even tripling in terms of IDR collected.
“We have surpassed our target by a wide margin, and this has encouraged us to develop further our Sharia division,” said Jens Reisch, President Director of Allianz Life Indonesia. “We are holding continous training sessions to certify agents in sharia principles, in several cities in Indonesia. Today we have more than 2100 financial planners certified to offer amongst others, sharia products. Today, the most productive regions are Jakarta and Kalimantan.”
Allianz Utama, the Allianz non-life insurance company in Indonesia, offering Motor and Property (dwelling houses and small businesses) started offering Sharia products, in the second quarter of 2006, with very satisfying results as well. Allianz Utama managed to issue nearly 200 property policies and 140 motor policies amounting to a total premium income of IDR 1.35 billion. Like the life company, sales in 2006 concentrated on the largest cities of Indonesia, especially Jakarta and Balikpapan.
Optimistic outlook for 2007 – one-stop solution and new products
One of the action plans taken by Allianz Indonesia to increase production, is to further the concept of One Stop Solution. The great advantage for the customer is to be able to obtain all insurance needs through one contact person or insurance agent. On the other hand, the concept enables all agents pertaining to both Allianz Life and Allianz Utama to sell both Allianz companies’ products.
“As an additional plan , we are expanding our Sharia range of products, by developing new products such as the Sharia Benefit Account, which allows a minimum of IDR 150,000 per month in premium, allowing insurance to be affordable to a larger customer base.” added Jens Reisch of Allianz Life. “For individual health insurance, we will soon have the Sharia Violet, and we are also working with our banking partners to develop a Sharia Unit-Linked product” said Jens Reisch. With new products and strengthening sales channels, Reisch feels confident to raise the bar for 2007. “We are optimistic that we can double our Sharia business in 2007 compared to the last year,” he concluded.
Allianz Utama is also developing new products, amongst others, a Sharia Personal Accident insurance. Local availability of products will be extended by reaching out to markets such as Padang and Aceh while at the same time giving extensive training programs for all Allianz agents, and winning new banking partners. One alternative distribution channel that Allianz Utama will develop is utilizing brokers and joining a consortium to insure Indonesians working abroad (TKI).
“We are on the right track towards even more success in sharia business this year,” said Victor Sandjaja, President Director of Allianz Utama Indonesia. He believes that the outlook is very positive for sharia insurance, but that there is still a way to go. ‘We understand that sharia is not yet widely known by the public. To address this issue, we plan to launch a two way communication advertisement, whereby we publicize not solely to sell our products but to provide a deeper understanding of the benefits of a sharia insurance product,” Victor Sandjaja added.