Driven by the by the family Takaful sector, Indonesia’s Takaful industry anticipates stable growth stemming from regulatory support

Indonesia’s Takaful industry reached IDR 16.7 trillion in 2019, led by family Takaful, which accounted for IDR 13.9 trillion (83% of the Takaful market), according to data from Fitch Ratings.

Family Takaful grew at a rate of 10% Year-on-Year (YoY) in 2019 (14% in 2018), outperforming the country’s conventional life insurance market, which grew by only 1% YoY in 2019.

Indonesia’s life insurance industry is still in its nascent stages, with penetration at around 1.5%. Fitch attributes low penetration mainly due to lack of consumer awareness and knowledge on Takaful products.

However, positive efforts on the part of the Indonesian government through the Indonesia Islamic Economic Master Plan 2019-2024, for example, should facilitate the develo...