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As of 2024, the insurance penetration rate in Indonesia slightly decreased to approximately *** percent from *** percent in 2022. The highest penetration rate was recorded in 2020. Despite the low penetration, the insurance industry’s contribution to Indonesia’s gross domestic product (GDP) has steadily grown over the years.

Literacy and inclusion: the keys to insurance adoption

In Indonesia, the literacy on insurances remains relatively low, especially compared to the country’s overall financial literacy rate. It is followed by an even lower rate of financial inclusion, reflecting a significant gap between knowledge and the actual accessibility to insurance products among the population. This issue was also highlighted in a recent survey, which revealed that a lack of understanding of how insurance works was the most common reason for not having health insurance among Indonesian respondents.

Health insurance in Indonesia

Health insurance is arguably the most crucial type of insurance that everyone should ideally have. Despite the government’s efforts to provide affordable coverage through the national health insurance program (BPJS Kesehatan), about a third of the Indonesian population remained uninsured. Unsurprisingly, the ownership rate of private health insurance is still very low. This is mainly due to limited financial resources among the population, as the current level of per capita income in the country makes private insurance unaffordable for many.