The Financial Services Authority (OJK) has outlined four strategic policy directions aimed at strengthening the national insurance industry as well as emphasizing financial health, efficiency, and consumer protection.

Ogi Prastomiyono, Chief Executive of Insurance, Guarantee, and Pension Fund Supervision at OJK, revealed outlined the strategies during the Indonesia Insurance Summit 2025 held in Bali on Thursday, May 22, 2025. He cited that these initiatives are designed to build a robust and efficient insurance system capable of withstanding economic shocks while also maintaining public trust.

The first strategy focuses on reinforcing capital requirements and expanding the insurance market. OJK asks insurance companies to increase their paid-up capital as a prerequisite for obtaining new business licenses. For existing firms, a minimum equity threshold will be implemented to ensure long-term sustainability.

“We’ve categorized insurance companies by equity size to better assess and strengthen their ability to absorb risks,” Ogi said.

He added that OJK has already issued regulations requiring minimum equity increases for insurance and reinsurance firms.

Additionally, starting in 2028, OJK will implement a dual classification system for insurance firms − KPP 1 and KPP 2 − based on equity levels. KPP 1 companies with larger capital will have broader business opportunities, while KPP 2 companies will operate within more limited scopes.

According to OJK Regulation No. 23/2023, insurance companies must meet a minimum equity requirement of Rp250 billion (US$15 million) by 2026, with further incremental increases through 2028. Companies are also required to spin off their sharia business units by 2026 to ensure clear and focused operations.

The second policy direction focuses on improving corporate governance and risk management within the industry. This includes strengthening organizational structures, upgrading human resource competencies, and enhancing key business functions such as underwriting, investment, and claims processing.

“OJK is improving HR policies across all levels − from supporting professions to the regulators themselves − to ensure sound, transparent, and accountable business practices,” Ogi said.

The third strategy aims to develop a comprehensive insurance ecosystem, incorporating insurers, professional associations, and support services under a unified regulatory framework. OJK will apply holistic oversight across all players in the sector to ensure coordinated and integrated supervision.

The final strategic pillar focuses on expanding the range of insurance products available in the market, including unit-linked insurance (PAYDI), credit insurance, and health insurance. This strategy will be guided by the National Insurance Industry Roadmap for 2023–2027, which outlines long-term development goals and innovation priorities for the sector.

With these strategies, OJK aims to make Indonesia’s insurance sector more resilient, inclusive, and adaptive to the evolving needs of the population − laying the groundwork for a more sustainable financial services industry.