Insurance Literacy in Indonesia Still Low

The Financial Services Authority (OJK) recorded that insurance literacy index in Indonesia in 2017 has only reached 15.76%, a decline from survey result of 17.84% in 2013. Meanwhile, the level of insurance use is 12.08%, an increase although insignificant from survey result of 11.81% in 2013.

The data means that out of 100 Indonesians, only 15 to 16 people are familiar with insurance firms, and only 12 have used their services.

Insurance Council of Indonesia (DAI) Chair Hendrisman Rahim said that currently, insurance penetration in Indonesia has only reached 6%-7%. The number is still very small compared to the Indonesian population that has reached more than 265 million with the number of insurance policy holders standing only at 1.7%.

Hendriman said that DAI and related industry players remain committed to improve financial literacy and inclusion in Indonesia, especially in pushing for the availability of access and financial services that reach all layers of population. "Continuous promotion is a common task for all insurance industry players," he said (Republika, December 9, 2017).

Not only in life insurance, literacy also needs to be improved concerning insurance of car purchased with cash. This is because buyer must then register themselves to an insurance firm. This is different with credit payment, because the insurance policy would be part of the purchase package.

Used car seller mobil88 has its own way to help increase customers' understanding of the importance of insurance for used cars. For instance, mobil88 offers an after-sales service of free insurance policy for buyers who pay with cash.

Every car purchase with cash is entitled to an all-risk insurance for three months. The benefit is that if the customer wants to extend the duration of insurance coverage to one year, it means they only need to pay for the remaining nine months. This will protect the car further from any risk that might occur.

Besides that benefit, mobil88 also offers buyback guarantee for every car purchased. This guarantee is a commitment of mobil88, as a subsidiary of PT Serasi Autoraya (SERA), that all the cars that they offer to customers have undergone selection, re-conditioning, and strict quality test.

The guarantee covers five things: the used car has never been immersed in a flood, it has not experienced an accident that might have affected its chassis, the engine number and the chassis number match those in the car ownership and car registration documents, the odometer has not been wound back, and the documents are complete and authentic.

If there is anything of the above that is not met, the customer can exchange the car as long asthe terms and conditions from mobil88 are still fulfilled. mobil88 President Director Fischer Lumbantoruan explained that the customer must remember that there are factors that may result inthe rejection of the customer's claim, for instance, if the ownership of the car has been transferred or if the car has been sold to another person or a third party.

"So,when a person buys a car, the car is still registered under the name of the previous owner; but if the person has transferred the ownership and sold the car to a third party, then the guarantee will be void," Fischer said.

Fischer added that if the customer has transferred the car ownership straight after buying the car in mobil88, the guarantee still applies. However, there is a time limit: three months for the condition of the cars and one year for the papers.

With such guarantee and free insurance, more people will prefer used cars. One of the showrooms offering the guarantee is mobil88, which is also a subsidiary of Astra.

Before purchasing, potential buyer can access the website www.mobil88.astra.co.id first to see the availability of the cars. If you want to observe with your own eyes, you can also visit the nearest mobil88 showroom.

Having more than 20 branches in big cities in Indonesia, mobil88 sells high-quality used cars of various brands and models. Moreover, mobil88 has experience in selling and buying used cars for more than 30 years.

Please click this page for further information about mobil88's services.