Hanwha Life Insurance Indonesia is planning an initial public offering in 2020 to meet regulatory requirements and to fund growth in the Indonesian market.
At present, a non-Indonesian entity cannot have a stake of more than 80% of an Indonesian insurer.
For an insurer to go public in Indonesia, it is required to have reported profits in each of the two previous years. Hanwha Life Insurance Indonesia, controlled by South Korean insurance giant Hanwha Life, has been in the red since its establishment in 2013, reported Business Korea.
In 2012, Hanwha Life Insurance acquired 80% of shares from local insurer Multicor. But its current stake stands at 98% as a result of additional investment.
The company feels that the Indonesian unit can show some substantial growth this year and comply with the regulations at the same time if it strives foran IPO.
Hanwha Life Insurance Indonesia has targeted a 93% increase in its premium income, from IDR209 billion (US$15.68 million) in 2016 to IDR403 billion this year, on the back of the launch of new products and an expansion in sales channels.
Hanwha Life Indonesia chief bancassurance and agency officer director Henry Januar said that to achieve the target, the company would open six other sales offices in Medan, Pekanbaru, Palembang, Jakarta, Solo and Makassar in addition to the 12 existing sales offices. The company targets the number of sales offices to be 30 until the IPO.
“We aim to have 4,631 agents by the end of 2017 from 3,330 agents we have currently,” Mr Henry said.
He said Hanwha Life Indonesia targeted to gradually take all of its agents on full time, with all of them full time in 2020 and earning at least IDR5,000,000 a month.
“The total premium income from agents, bancassurance and corporates are respectively IDR128 billion, IDR25 billion, and IDR250 billion,” Hanwha Life Indonesia deputy chief agency officer Marcello Twijsel said.