Insurance Startups Gain Profits during the Corona Pandemic
The Financial Services Authority (OJK) noted that the insurance industry premium fell 6.45% on an annual basis (year on year/yoy) per August. However, insurance startups such as Qoala and PasarPolis are still recording increases in several products amid the corona pandemic.
Qoala, for example, processes over two million policies per month at the moment. The number is soaring compared to last year’s 7,000 policies per month. “The development of our business is very good amid the pandemic. However, we want to achieve higher targets by the end of the year and 2021,” said Qoala VP of Marketing Cliff Sutantijo, Wednesday (21/10).
Qoala also launched bicycle insurance this month. This product is the result of cooperation with the broker Mitra Jasa Pratama and the general insurance company Takaful. The company offers coverage that covers total to partial damage.
In addition, there is protection for personal accidents, third party lawsuits, and natural disasters and riots. It also covers evacuation and ambulance costs in the event of an accident on the road.
“We consider the bicycle trend to continue. On that basis, we hope that the premium target of Rp 6 billion or more can be achieved next year, “said Cliff. The demand for bicycles has indeed increased during the coronavirus pandemic.
Data from the Indonesian Bicycle Entrepreneurs Association, the average order reaches 700 thousand a month this year. From 2014 to 2019, demand ranges from 5.5 million to seven million units per year. During this pandemic, bicycle orders are predicted to increase to eight million units.
Apart from bicycles, Qoala also noted an increase in demand for freight insurance. “The popularity of health insurance and logistics for e-commerce has increased during a pandemic,” said Head of Partnerships Qoala Cindy Tan, last September (25/9).
The Demand for Insurance in PasarPolis is also Increasing
Likewise with PasarPolis, which recorded that demand for shipping service insurance such as GoSend and GoBox increased 12 times during the Covid-19 pandemic. In addition, insurances for Gojek driver-partners was purchased by more than 200 thousand.
“We noted that more than 90% of those who bought on the platform were new consumers. Products purchased are like protection for shipping goods in e-commerce,” said the founder and CEO of PasarPolis Cleosent Randing in a dialogue entitled “Technology Industry to Increase Financial Inclusion in the Middle of a Pandemic”, Tuesday (20/10).
McKinsey had estimated that there would be 1.6 billion packages of e-commerce transactions sent per year, by 2022. The number could potentially be greater because of the pandemic. According to AppsFlyer’s report entitled ‘The State of Shopping App Marketing 2020 Edition’, Indonesian consumers spending time on e-commerce platforms increased by 70% during February-June.
PasarPolis is indeed focused on providing insurance solutions according to partner needs (tailor-made). With Tokopedia and other e-commerce, for example, this startup provides goods protection.
“What innovations are suitable in Indonesia, such as People’s Business Credit (KUR) and driver-partner insurances. This does not exist in Singapore, for example. This is unique,” said Cleosent.
Both Startups Get Funding in the middle of the Pandemic
In addition, the company focuses on providing affordable insurance products. Therefore, the company plans to launch a new product. “There are a lot of concerns right now that we need to answer,” he said.
One of them is related to travel and tourism. As is known, there are several requirements that must be fulfilled by prospective aircraft passengers, including a Covid-19 free certificate. With this tightening, travel plans are at risk of being canceled so insurance becomes a necessity.
Amid the increasing demand, the two startups also received funding despite the pandemic. Qoala announced the acquisition of series A funding of US$ 13.5 million or around IDR 209 billion last April. This investment is led by the Centauri Fund, a joint venture company of South Korean Kookmin Bank and Telkom Indonesia. Meanwhile, PasarPolis announced the closure of series B funding.