Indonesia’s Financial Services Authority (OJK) and Ministry of Finance reviewed insurance and pension reforms at an Organisation for Economic Co-operation and Development (OECD) accession review in Paris. Discussions covered stronger insurance prudential standards, preparations to harmonize pension programs and potential changes to pension investment rules. The review examined alignment with OECD legal instruments, revisiting OJK’s previously articulated priorities of stronger supervision and wider pension participation. Insurance reforms include phased increases in minimum equity requirements in 2026 and 2028, alongside changes planned for 2027 to make the risk based capital framework more sensitive to risk. Indonesian Financial Accounting Standard 117, which adopts International Financial Reporting Standard 17, has applied since 2025. With commercial insurance penetration still around 1.3% of gross domestic product, OJK is emphasizing stronger governance and asset and liability management to support wider coverage. Supervisory priorities also include early intervention at troubled insurers and oversight of sales practices, claims handling and complaints. On pensions, mandatory participation requirements cover about 37% of workers, while active participants in mandatory schemes represent around 17% of the labor force. The government is preparing to harmonize mandatory and voluntary programs to expand participation, improve benefit adequacy and strengthen regular benefit payments, taking account of workers’ contribution capacity. OJK is reviewing investment provisions and preparing regulatory adjustments to allow greater portfolio diversification under prudential safeguards. Its work on voluntary pension funds also emphasizes asset and liability management, investment strategies tailored to participants’ life stages and stronger governance, continuing its earlier focus on coverage gaps among informal workers.
Indonesia’s Financial Services Authority reviews insurance capital reforms and pension investment plans at OECD accession forum
Indonesia’s Financial Services Authority presented an update on insurance and pension reforms during an OECD accession review. Insurance measures include phased minimum equity increases in 2026 and 2028 and capital framework changes planned for 2027. Pension investment adjustments under preparation would broaden diversification, while the government works to harmonize mandatory and voluntary schemes to expand coverage and improve benefits.