Inforial (The Jakarta Post)
Mon 13 Jun 2022
PT AIA Financial (AIA), one of Indonesia’s leading life insurance companies, has launched AIA Platinum Legacy, a pure life insurance product that targets wealthy or premium clients to help them establish a fund of inheritance for their offspring in order to sufficiently manage their quality of life.
Generally, clients classified as having high net worth (HNW) possess financial well-being and contribute significantly to the growth of businesses, including the insurance industry. They include business owners and executives.
According to the results of a 2020 study by AIA and Ernst & Young (EY), the Asia-Pacific region has the highest number of high net worth individuals in the world. According to Wealth-X’s 2019 High Net Worth Handbook, the HNW population in Asia-Pacific will continue to grow from 2.6 million to 8.7 million in 2023.
As a result, the demand for life protection products has seen a surge, alongside growing demand in the premium segment of wealth protection and estate planning.
“As a life insurance company that has long focused on developing products for the premium segment, we are proud to announce the AIA Platinum Legacy product to meet the need of customers, especially homeowners. company and professional executives, for the protection of life to leave a better legacy for the next generation,” AIA Chief Marketing Officer Kathryn Parapak said Monday after the launch of the new product.
“Our internal data shows that on average, our HNW customer segment has more than three policies and their need for protection increases with the phases of their life,” she continued.
“When designing the product, we also paid great attention to the benefits of protection. For this reason, we have also designed the maximum sum assured of AIA, which is one of the highest [amounts] in industry.”
Explaining AIA’s development strategy, she revealed that financially healthy HNW clients need diversified investment instruments.
“In insurance, valuation is effective from day one. The Platinum Legacy product helps them plan their legacy for the next generation,” she added.
AIA Platinum Legacy is also backed by the company’s partnership with professional agents, including the Million Dollar Roundtable (MDRT), trusted by premium clients.
“MDRT Agents have high quality marketing and sales departments which have been successful in attracting many customers to multiple policies which drives our business,” she said.
“The research also shows the complexities surrounding legacies. In terms of business continuity, for example, only 30% of business owners pass on their business to their offspring. Thus, the Platinum Legacy should help business owners plan their legacy well.
AIA currently markets its AIA Platinum Legacy product to HNW customers through its MDRT agents. “We are confident in reaching the target market because our MDRT agents have established a large network of high-end clients,” Kathryn said.
Its longstanding focus on the HNW segment through the support of MDRT agents is one of AIA’s strengths, and the company has determined that this partnership is the right channel to introduce the AIA Platinum Legacy.
AIA Platinum Legacy offers five primary value propositions.
The first is the maximum protection value, with the sum insured increasing by 20% every five years without additional underwriting.
“This allows [a customer’s] face amount to be increased to double the value of your original face amount, which will help you plan your legacy. For example, if your initial sum assured was 5 billion rupees, the sum assured will increase by 20% every 5 years up to 10 billion rupees in 25 years,” Kathryn said.Second is the ease of application, which dispenses with health checks for customers with an insured sum of Rp 15 billion.
Third is a short premium payment period. Typically, insurance customers pay premiums 10 times over 10 years or more. But with Platinum Legacy, customers can only make their premium payments once or twice, depending on their financial situation.
“It is undeniable that the economic cycle has ups and downs. With AIA Platinum Legacy, customers can only pay once when business is booming, which means they can make one legacy planning payment for the rest of their life,” noted Kathryn.
FourthPlatinum Legacy comes with an additional care benefit that provides an advance of 50% of the sum insured in the event that a client with valid coverage suffers from a critical illness and requires additional funds for treatment .
Fifththe product comes with the comprehensive AIA Vitality plan and Personal Medical Management to help customers live healthier, longer and better lives.
“At AIA, we not only care about better inheritance planning for clients, but we also help clients lead healthier lives so they have more time to spend with their families,” said said Kathryn.
The AIA Vitality health and wellness program adopts a shared value model that benefits all customers, not just HNW customers.
“Customers who complete health activities each week through the Vitality app earn reward points. When customers reach a certain level, they earn reimbursement from AIA, with the amount depending on the product and level. [attained],” she added.
More customers get cashback means more people reduce their health risks and become healthier. “This will be followed by a potential drop in claims. So the program offers a win-win solution,” Kathryn pointed out.
“Since the launch of the very first AIA Vitality [program] in 2021, we continued to focus on spreading the initiative to the general public by integrating it into our life insurance products. AIA Vitality perfectly complements AIA Platinum Legacy, as we believe that a legacy is not only wealth, but also health,” she said.
“We hope that with AIA Vitality, customers can lead better lives that allow them to spend more quality time with their loved ones, and also provide more opportunities to pass on better values to their offspring.”
“We [also] hope our clients welcome AIA Platinum Legacy as it is a solution to increase asset allocation to achieve a legacy goal,” said Kathryn.
AIA launched AIA Platinum Legacy based on strong performance, reaffirming its leading position in life insurance in Indonesia.
AIA’s data on its financial performance in 2021 showed that it experienced strong growth with Rs 55 trillion in assets under management and Rs 50 trillion in total investment assets.
The company recorded revenues totaling 15.9 trillion rupees and paid out 11.49 trillion rupees in claims, reflecting its core commitment to be the most trusted life insurance company in Indonesia.
AIA has achieved a solvency ratio of 660%, well above the government-mandated solvency ratio of 120%, proving its financial strength.