PROPOSED MARKETING STRATEGY TO INCREASE THE NUMBER OF IN-FORCE POLICIES IN PT SLI

• Main Author: Adit Wibisono, Hario
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/53452
• Institution: Institut Teknologi Bandung

Indonesia is one of the most populous countries in the world, with a population of 268 million as of 2019, which makes Indonesia an attractive insurance market. Following Insurance Law No. 40 of 2014, insurance can be classified into general insurance and life insurance categories. Life insurance companies’ revenue can be split into two, which are New Business Premium and Renewal Premium, and the sum of these two is called Gross Written Premium (GWP). According to the Indonesian Life Insurance Association (Asosiasi Asuransi Jiwa Indonesia, AAJI), the GWP of the Indonesian market has continuously grown in the last ten years at 12.3% since 2009. However, compared to Indonesia’s Gross Domestic Product (GDP), life insurance penetration in Indonesia, measured by GWP/GDP, is relatively stagnant at 1.1% to 1.4%. PT SLI (SLI) is a joint venture company backed up by a strong, well-capitalized global parent company. SLI has been operated in Indonesia since 1995 and focused the sales on unit-linked insurance products, marketed to individual policyholders through Agency, Bancassurance, and Telemarketing distribution channels. SLI is one of the fastest-growing companies on the market, shown by its growth rate that has always outperformed the industry for the last five years; Compounded Annual Growth Rate (CAGR) of SLI’s Individual New Business in 2015 – 2019 is 19.4%, while the overall Indonesia Market CAGR in 2015 – 2019 is just 7.3%. As of 2019, SLI was able to secure rank six among other foreign JV companies in Individual New Business. As a fast-growing company, SLI focuses its operations on acquiring as many clients as it can. However, SLI is also facing a severe problem at the same time. While the new business is growing, the number of in-force policyholders is declining, especially in the Agency channel. To formulate the marketing strategy, a series of analysis has been conducted on the company’s external and internal factors. Several tools used in the external environment analysis are the PESTEL Framework, Porter’s Five Forces Model, Customer Analysis, and Competitor Analysis. Meanwhile, the tools being used from the internal environment analysis are Segmentation, Targeting, and Positioning Model Analysis and the 7Ps Marketing Mix. Upon studying the internal and external factors of SLI, the research suggests a marketing strategy that could potentially increase the number of in-force policies of SLI by implementing several actions, such as redefining SLI Agency target market, redefining SLI positioning, conducting a continuous marketing program, conducting regular financial literacy program, recruiting higher caliber agent, revamping Agency compensation, strengthening agent retention program, and strengthening Agency training program.