The JCI Shock and Unit-linked Risks

KONTAN.CO.ID – JAKARTA. On Friday, 16 October 2026, the Jakarta Composite Index (JCI) closed down 11.57% at 5,185, its steepest daily fall since the 1998 crisis. The trigger was an announcement by MSCI the previous day. The global index provider opened a consultation on downgrading Indonesia’s equity market from emerging-market to standalone-market status, bypassing the frontier-market category. The following Monday, the index fell again to 4,996. Compared with its 27 January close of 8,980, a day before MSCI’s decision to freeze the index shook the market, the JCI has lost around 44%.

MSCI’s warning is often seen as a matter for investment managers. However, insurance policyholders are also among those who bear the impact. At an event marking Insurance Day on 20 October, the Financial Services Authority (OJK) disclosed stress-test results showing that life insurers were more affected than general insurers because they have a larger share of their assets invested in equities. The regulator is mapping companies whose risk-based capital (RBC) ratios have fallen below the 120% threshold. Each company’s investment committee has been asked to reassess its strategy.