Indonesian mobile wallet Ovo and ZA Tech, a joint venture of ZhongAn and SoftBank’s Vision Fund 1, have teamed up to create an insurtech platform, Ovo announced on Tuesday through its holding company PT Bumi Cakrawala Perkasa (BCP).
Ovo said that the new service will be ready next year and that it will draw on ZA Tech’s proprietary technology and applications. “The platform will anchor on supporting our customers and business partners including insurance companies and partners,” Ovo’s head of corporate communications Harumi Supit told KrASIA. Insurers can make their digitized products available on the Ovo app. “The joint venture will certainly support the rise of insurance aggregators or marketplaces,” she added.
Insurance penetration is very low in Indonesia, it only reached 2.77% in 2018, according to the General Insurance Association of Indonesia (AAUI). However, the COVID-19 pandemic has led to a rapid rise in demand for protection, showing there is a vast potential growth in Southeast Asia’s largest economy.
The new alliance is in line with Ovo’s plan to further strengthen its proposition in digital insurance. In an interview with KrASIA earlier this year, CEO Jason Thompson said that the startup wants to provide the most comprehensive suite of financial services to all Indonesians through additional insurance and investment offerings. In May, Ovo launched online insurance products in collaboration with Prudential Indonesia.
“Prudential is a valued partner and will certainly have access to the new insurtech platform,” said Supit. “We expect to make new products from Prudential available on the Ovo platform in the near future as we continue to intensify collaboration in order to drive insurance penetration among our users.”
Ovo CEO Jason Thompson said in an official statement that by using the platform, local insurance companies will be able to digitize their conventional offerings, thereby delivering products and services more effectively to the masses.
In 2019, ZA Tech established a similar joint venture with Ovo investor Grab to distribute digital insurance in Southeast Asia.