Merger Consolidation of State-Owned Insurance Companies Under Exploration by Danantara

The consolidation process for state-owned insurance companies is currently in the exploratory stage. The Indonesian Life Insurance Association (AAJI) views this move as a positive effort to strengthen the national insurance industry.

Handojo G. Kusuma, Head of Inter-Institutional, Regulator, and Domestic and International Stakeholder Cooperation at AAJI, stated that consolidation fundamentally provides a beneficial impact on the industry. “I believe it is better to view it as creating one stronger company. The crucial aspect is how the consolidation process is conducted, while ensuring the interests of each company’s customers are protected,” Handojo said during an AAJI press conference on Tuesday.

He emphasised that the consolidation must be carried out cautiously, prioritising policyholders’ interests to ensure that the merger proceeds smoothly without disrupting services. This momentum is also expected to encourage industry players to increase capital capacity and competitiveness in line with the industry strengthening targets set for 2028.

“The process appears to still be under exploration by Danantara,” he added.

Previously, the Danantara Investment Management Agency announced plans to merge 15 state-owned insurance companies into three specialised units: one for life insurance, one for general insurance, and one for credit insurance.

Dony Oskaria, COO of BPI Danantara, stated that this year, the number of SOE subsidiaries and sub-subsidiaries will be reduced from 1,043 entities to approximately 300. He confirmed that all SOEs will be affected by this restructuring, including the insurance sector.