Members Report: MIR Insurance Brokers AAA Conference | 24 May 2019 Beijing, China Members Report: MIR Insurance Brokers

Name of Member: PT Mitra, Iswara & AAA Members Report – Indonesia Country: Indonesia Name of Member: PT Mitra, Iswara & Rorimpandey (MIR Insurance Brokers) Membership details - Annual Premium Turnover 2018: US$ 80,358,868 (off-setting by the discount) - Number of Staff: 174 staff

AAA Members Report – Indonesia Countries of Operation: Indonesia - Location: Jakarta (HO) and 6 branches (Surabaya, Semarang, Bandung, Bali, Makassar, Balikpapan)

AAA Members Report – Indonesia % of premium by Class of Insurance

AAA Members Report – Indonesia Professional Indemnity Details - Limit of Indemnity: USD 10,000,000 - Legislative Requirements: USD 210,000 - Insurers: CHUBB GENERAL INSURANCE INDONESIA

AAA Members Report – Indonesia Who regulates Insurance Brokers in the country: The Financial Services Authority (Otoritas Jasa Keuangan – OJK) What Insurance Broker and Agent Education Programs exists: APPARINDO (The Association of Indonesia Insurance and Reinsurance Brokers) AAMAI (The Indonesian Insurance Institute): AAAIK, AAIK APARI (The Association of Indonesian Qualified Insurance & Reinsurance Brokers): AAPAI (matched against ANZIIF Affiliate CIP), APAI (matched against ANZIIF Associate CIP), CIIB (matched against ANZIIF Senior Associate CIP)

AAA Members Report – Indonesia What Insurance Broker and Agent Education Programs exists (2): BNSP (National Professional Certification Board): Level 5 Competency: Marketing Level 6 Competency: Director Level 7 Competency: Tenaga Ahli (Registered Insurance Expert)

AAA Members Report – Indonesia How many Insurers operate in the country: 140 Companies (79 non-life, 61 life), and 6 reinsurance companies How many Insurers are active in Broker markets: All non-life Insurers are trying to enter into Broker business, in our opinion the total insurer active in broker markets is not more than 40 companies

AAA Members Report – Indonesia Market Structure 2013 2014 2015 2016 2017 Insurers 141 145 146 152 Brokers 182 157 203 209 212 Gross Premium including R/I Premium (Trillion Rp) (Non Life) 46.37 54.70 60.25 66.61 70.42 (US$ 5,192,066,651.92) Brokerage including R/I Brokerage (Trillion Rp) 1.6 1.69 2.27 2.07 2.20 (US$ 162,206,001.62) Note: ROE December 2017: USD 1 = IDR 13,563

Market Conditions AAA Members Report – Indonesia - Number of Insurers decreasing, increasing, stable: Stable at 86 General Insurer/ Reinsurer - Insurance capacity decreasing, increasing, stable: Stable - Premiums decreasing, increasing, stable: increasing, a growth of 5.7% compared to 2016

Market Conditions AAA Members Report – Indonesia - Commissions decreasing, increasing, stable: increasing - Average Broker income percentage earned as fees: less than 5% - Average Broker income percentage earned as commission: at least 95% is a commission income

AAA Members Report – Indonesia Number of Brokers decreasing, increasing, stable: Increasing from 209 to 212, increase for all category i.e. local broker, joint venture broker and also reinsurance broker Overall level of Insurance Business decreasing, increasing, stable: Increasing Percentage of business controlled by Brokers: 35% Percentage of business controlled by insurers (direct): 50% Percentage of business controlled by other intermediaries e.g. banks: 15%

RANKING OF INDONESIA INSURANCE BROKER IN 2017 AAA Members Report – Indonesia RANKING OF INDONESIA INSURANCE BROKER IN 2017 (For direct Broker only)

RANKING OF INDONESIA NON LIFE INSURANCE COMPANY IN 2017 AAA Members Report – Indonesia RANKING OF INDONESIA NON LIFE INSURANCE COMPANY IN 2017

AAA Members Report – Indonesia Note: Total Gross Premium in non-life direct insurance market is IDR 63.5 Trillion (USD 4.7bio) which is a 5.6% growth Total Premium of JV Companies: IDR 16.7 Trillion (USD 1.232bio) equivalent to 26.3% market share which is up from 2016

AAA Members Report – Indonesia Information Technology used by Brokers (including online platforms): - Self-developed E-Marine System - Self-developed E-Claim System - Self-developed E-Endorsement System - Premiro.com via subsidiary company namely MIT

AAA Members Report – Indonesia Political issues at time of report: The Election has gone through relatively smooth. Presidential candidate Prabowo Subianto called for irregularities in data entry from polling stations to be corrected, as his team unfurled a long list of charges against the election authorities and incumbent Joko Widodo that he said show the "blatant and flagrant violation of basic norms of democracy" in Indonesia's April 17 elections. Similarly, the incumbent team also has a long list of accusation against Prabowo Subianto. At the end of the day, hopefully it can be settled according to the law.

AAA Members Report – Indonesia Economy at time of report: Indonesia’s economic growth slowed in the first quarter amid a global slowdown that hurt the nation’s exports. Gross domestic product, the broadest measure of goods and services produced in the economy, rose 5.07 percent in the first quarter from a year ago

Member’s view of Insurance Broking over the next 3 years: AAA Members Report – Indonesia Member’s view of Insurance Broking over the next 3 years: The market will remain difficult with the insurers trying to keep the tariff regime in order to increase their margin and to limit the scope of broking market. However, in any difficult situation lies opportunity through the clever use of reinsurance market globally.

AAA Members Report – Indonesia Member’s principle activities/successes over last year: Continue to expand the R/I Broker, Web Broker, International Business (increase the country we work with e.g. Taiwan) and also the Compliance / Internal Audit with the strengthening of the internal procedures. Initiate the setting up of Business Development unit and Banking Business unit to add on the growth.

AAA Members Report – Indonesia Any major issues/challenges: Tariff and Regulation Member’s planned activities over the next 3 years: Enhance Business Development in all line of business to ensure maintaining top 3 position