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merican insurance firm ACE Life plans to build stronger a distribution channel and create more products in a effort to expand its premiums in Indonesia by 20 to 30 percent next year, an executive of the company has said.

ACE Life finance and accounting director Susanto Halim said despite the lingering economic downturn his company remained optimistic about expanding its market amid the industry'€™s relatively low penetration of only 2 percent.

'€œThe company targets the same growth rate of 20 to 30 percent as projected by AAJI [Indonesian Life Insurance Association] for next year,'€ he told reporters last week.

In its unaudited financial report, the firm reported a gross premium revenue of Rp 856 billion (US$32.8 million) as of September this year, a 32 percent increase from the Rp 648 billion in the same period last year.

Susanto added, '€œWe'€™re in the process of planning more products with our actuary team and will surely add more agents and partnerships with more banks,'€ he said.

Meanwhile, the company'€™s chief marketing officer, Dessy Masri, said the firm currently had more than 6,000 agents and partnerships with 11 banks. She did not give details of next year'€™s plan for agent recruitment and partnerships.

Dessy said the company'€™s agents contributed up to 80 percent of the company'€™s sales, while the remaining 20 percent was from partnerships with banks.

'€œIn the future, we want to see a more balanced contribution [between agents and partnering banks],'€ she said, adding that she would be using more of other channels, including telemarketers.

According to AAJI, insurance agents contribute the greater part of the premium income of local insurance companies despite the increase in the use of banking channels, or bancassurance, to net new policyholders.

'€œOur data shows that the agents contributed almost 50 percent of last year'€™s Rp 121 trillion [US$8.85 billion] in life insurance premiums,'€ AAJI chairman Hendrisman Rahim said earlier, adding that the association hoped to have 500,000 agents by year-end and 1 million agents by 2020.

As many as 454,706 licensed life insurance agents were recorded as of June, a 27.46 percent increase from the 356,731 agents recorded in 2013. The annual average growth since 2013 reached 17 percent, according to AAJI data.

AAJI acting executive director Togar Pasaribu revealed that the contribution by agents was closely followed by bancassurance at around 48 percent while the remainder came from other sources, including telemarketing.

AAJI has forecast the industry'€™s premium growth to reach between 20 and 30 percent next year.

As of September this year, the association reported that its members posted a total premium revenue of Rp 100 trillion, a 20 percent increase year on year (yoy). (rbk)