Insurance Sector Faces Capital Compliance Deadline

OJK Reports Progress in Capital Enhancement

The Financial Services Authority (OJK) has reported that while significant progress has been made, 29 insurance and reinsurance companies remain below the minimum capital requirements set to be fully implemented by the end of 2026. As of November 2025, 115 out of 144 companies (79.86%) have successfully met the required minimum equity levels mandated by OJK regulations.

Regulatory Framework and Capital Requirements

The OJK regulation (POJK No. 23/2023) establishes a two-stage capital enhancement requirement for insurance companies. The first stage deadline is December 2026, with the second stage set for December 2028. The minimum capital requirements vary by business type:

• Conventional insurance: Rp250 billion
• Reinsurance: Rp500 billion
• Sharia insurance: Rp100 billion
• Sharia reinsurance: Rp200 billion

Industry Compliance Status

Ogi Prastomiyono, Head of OJK's Insurance, Pension Fund, and Guarantee Oversight, stated that the current compliance rate is 79.86%, representing 115 out of 144 companies. The regulator has given non-compliant companies until the end of 2026 to meet the requirements. Ogi expressed optimism that more companies will comply by the deadline, stating, "We expect that by the end of 2026, an increasing number of insurance companies will have met the minimum equity requirements."

Market Implications

The capital enhancement regulation aims to strengthen the insurance industry's stability and capacity to pay claims. While the current compliance rate is positive, the remaining 29 companies must take immediate action to avoid potential regulatory consequences. The OJK continues to monitor the situation closely, balancing between regulatory enforcement and industry capacity.