The growth of the Indonesian insurance sector in recent years has not shown encouraging developments. OJK data shows that the penetration rate of insurance in Indonesia in 2021 will only reach 3.18%, consisting of 1.45% social insurance penetration, 1.19% life insurance, 0.47% general insurance, and the remainder compulsory insurance. In terms of growth in premium income, premiums for the insurance sector for the period January to November 2022 reached IDR 280.24 trillion or it can be stated that growth has been stagnant with a growth of only 0.44% compared to the previous year period. This is in line with the results of the 2022 SNLIK, where the insurance inclusion rate experienced a less significant increase, from 13.15% in 2019 to 16.63% in 2022.
The lack of rapid growth in the insurance sector can be caused by low use and public trust in insurance products. This is due to the problems that often arise in the insurance sector in the form of difficult claims processes, premiums that are not affordable by all groups, lack of public access to insurance products and the potential for default. To respond to some of these problems, the insurance industry is compelled to adopt and optimize the use of technology called insurtech. Insurtech is defined as a term that describes various developments and approaches taken by utilizing technological advances and data availability to optimize various opportunities in the insurance sector either to improve customer experience of insurance services or to provide operational efficiency for companies (Cambridge University Press, 2018)[1 ].
The presence of insurtech through the use of big data/machine learning and artificial intelligence is expected to be able to answer consumer needs, among others by facilitating and speeding up the underwriting process as well as claims, providing more personalized products (customization), and providing omnichannel services. With omnichannel services, customers can carry out various transactions in the insurance sector on one platform, starting from selecting services/products, executing transactions, submitting claims to paying bills. The presence of insurtech with digital services is also expected to encourage increased financial inclusion in the insurance sector by targeting and reaching the public through fast and borderless services.

As with the 2022 SNLIK results, there is a significant growth in the insurance sector literacy rate from 19.40% in 2019 to 31.72% in 2022. In addition, based on a consumer survey conducted by Swiss Re in 2020, almost 60 % of consumers surveyed prefer online channels compared to offline to help choose the right product, select premiums between insurance products and submit claims. With the growth in literacy rates and high consumer preferences for online services, this shows that the potential for developing insurance by optimizing the insurtech industry is still wide open. Therefore, the insurtech industry must be able to seize these opportunities quickly and innovatively.
Behind the opportunities that the insurtech industry has, there are challenges that must be faced. Some of these challenges include security factors and customer data protection, limited human resources who are competent in both insurance and technology business processes, and insurtech arrangements that are not yet comprehensive. In addition, the level of public trust in insurance products is still low because several problems in the insurance sector are also challenges faced by the insurtech industry.
In order to face various challenges and optimize the opportunities that exist today, insurtech organizers need to prepare various strategies, including the first to innovate their services and products so that they increasingly respond to consumer needs. The second strategy is to collaborate with relevant stakeholders to expand the range and distribution of service products to the public. The next strategy is to improve customer experience through embedded finance, increase education and socialization programs to increase consumer literacy and trust and optimize services to facilitate consumer transactions.
In order to support the growth and development of the insurtech business in Indonesia, OJK has taken several steps and efforts, including strengthening the role of research to support the business development of insurtech providers, increasing HR capacity in the financial services sector and issuing regulations that support the ecosystem of insurtech providers, namely POJK Number 13 / POJK.02/2018 concerning Digital Financial Innovation in the Financial Services Sector and POJK Number 28 of 2022 concerning Insurance Brokerage Companies, Reinsurance and Insurance Loss Appraisal Companies.

• In order to support the development of insurtech providers, it is necessary to conduct more in-depth discussions and discussions to explore the potentials and challenges faced by insurtech providers in Indonesia as well as the strategies of regulators and insurtech providers in responding to these opportunities and challenges with expert sources who are also practitioners in the banking industry.

[1] Institute and Faculty of Actuaries. Cambridge University Press. Improving the success of InsurTech Opportunities. 2018.

1. Provide insight and understanding to participants regarding the development of insurtech in Indonesia.
2. Provide insight and understanding to participants regarding the opportunities and challenges faced by insurtech actors in Indonesia.
3. Exploring the strategies of the insurance industry and insurtech providers in facing challenges and optimizing insurtech opportunities in Indonesia.