penetrate the insurance market in indonesia

How to Penetrate the Insurance Market in Indonesia

InCorp Editorial Team

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As the fourth largest nation in the world, Indonesia makes an enticing investment destination for investors interested in penetrating the insurance market. In line with the growing middle-class population, the rise of insurance demand in Indonesia is obvious.

In 2018, the insurance sector accounted for 3.01% of Indonesian GDP, an increase compared to the previous year 2017 at 2.84%.

In accordance with Indonesia Law, insurance companies in Indonesia are defined as organisations that provide conventional general insurance, reinsurance and life insurance services, as well as insurances that are Shariah-compliant.

For foreigners wanting to establish an insurance company, they will first have to establish a PMA (foreign investment company) to set up an insurance joint venture with a local partner as the maximum foreign ownership is set at 80%, and get a principle license from the BKPM (Investment Coordinating Board). Then, they have to obtain a business license from the OJK (Financial Services Authority) in Indonesia.

In this guide, Cekindo will talk more about the requirements for obtaining a business license for your insurance company.

Preparation before Penetrating the Insurance Sector in Indonesia

Before diving more into the insurance sector, you need to get familiar with the authorised institution in charge, which is the Financial Services Authority (OJK).

The OJK is the governmental authority that is in charge of license issuance, regulations, sanctions and policies in the insurance sector.

Foreigners must comply with the following OJK’s requirements in order to secure a business license. Please note that these are just some of the requirements. For a complete list of requirements, feel free to contact Cekindo directly.

  • Submit copies of Articles of Association of the PMA
  • Have a minimum equity of IDR 100 billion for a insurance PMA; or a minimum equity of IDR 200 billion for a reinsurance company
  • Give details of organisational structure, Board of Commissioners and Board of Directors
    Create a minimum guarantee fund – 20% of the compulsory minimum equity
  • Have qualified directors, commissioners, shareholders, members of Shariah Board, internal auditors and actuaries based on the OJK’s requirements
  • Identify a minimum of one controlling shareholder
  • Equipped with an adequate risk management system


Once the complete and valid application is submitted, the OJK will inform the foreign investor if the business license application is approved or rejected within 30 days.

Do keep in mind that all conventional or Islamic insurance or reinsurance companies must have at least one controlling shareholder report to the OJK on a regular basis. The OJK will get involved to appoint one for the company if the company fails to do so.

How Cekindo can Assist You in Penetrating the Insurance Market

Cekindo is among the top investment and business consulting firms in Indonesia. Our expert team helps you identify the potential markets and industries in Indonesia and convert these opportunities into greater performance.

Over the years, we have heightened our position across the diverse markets and sectors in Indonesia including the insurance market.

Through a sustainable business model and immense knowledge about the Indonesian market, Cekindo continues to envision the future by providing better solutions and creating value for you as an investor and business owner.

If you are looking for an investment consultant with the highest level of performance for your insurance company in Indonesia, you are in the right place.

Our expertise includes the following:

  • Company setup and registration
  • Business license and visa application
  • Investment consultation
  • Tax and financial consultation
  • Human resource and accounting outsourcing


Contact us through the form below to discuss your investment plan in the insurance sector in Indonesia.

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Disclaimer: The information is provided by PT. Cekindo Business International (“InCorp Indonesia/ we”) for general purpose only and we make no representations or warranties of any kind.

We do not act as an authorized government or non-government provider for official documents and services, which is issued by the Government of the Republic of Indonesia or its appointed officials.

We do not promote any official government document or services of the Government of the Republic of Indonesia, including but not limited to, business identifiers, health and welfare assistance programs and benefits, unclaimed tax rebate, electronic travel visa and authorization, passports in this website.

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