How to Acquire Shares in an Indonesian Insurance Company: Step‑by‑step, OJK Approval & Mol Verification

Understanding how to acquire shares in an Indonesian insurance company is essential for any strategic investor, private‑equity fund or multinational insurer planning an entry into Southeast Asia’s largest economy. Every transfer of shares in an Indonesian insurance business company (IBC) requires prior approval from the Financial Services Authority (Otoritas Jasa Keuangan, or OJK), even if only a single share changes hands. Since 2025, the Ministry of Law’s (MoL) introduction of substantive verification through Permenkum No. 49/2025 has added a distinct compliance layer to the corporate‑amendment stage, affecting timelines and documentary requirements for every share acquisition process in Indonesia.

This guide sets out the end‑to‑end procedure, covering eligibility, required documents, realistic timelines, costs and the regulatory changes that deal teams must account for in 2026.

Overview of the Share Acquisition Process and Who It Applies To

Indonesian law classifies insurance companies, reinsurance companies, insurance‑brokerage companies and related support businesses as Insurance Business Companies (IBCs). The primary statute is Law No. 40 of 2014 on Insurance, supplemented by OJK regulations, most recently OJK Regulation No. 23/2023 and OJK Regulation No. 36/2024, and the general company‑law framework under Law No. 40 of 2007 on Limited Liability Companies.

Two regulators sit at the centre of every share deal involving an IBC:

• OJK, responsible for prudential supervision, fit‑and‑proper assessment of incoming controlling shareholders, and prior approval of any change of ownership.
• MoL, responsible for corporate‑registration amendments filed through the SABH (Sistem Administrasi Badan Hukum) online portal, now subject to substantive verification under Permenkum No. 49/2025.

Two principal deal routes exist. For listed IBCs, foreign ownership of insurance companies is processed through transactions on the Indonesia Stock Exchange (IDX), as stipulated by government regulation. For unlisted IBCs, shares may be acquired through a private share‑purchase agreement (SPA) followed by OJK approval and notarial deed registration. Both routes require OJK prior approval; neither can bypass the MoL SABH filing obligation once the share transfer alters the company’s shareholder composition or articles of association.

Eligibility and Prerequisites for Acquiring Insurance Company Shares

Before entering negotiations, prospective buyers must confirm they satisfy the regulatory eligibility criteria that govern foreign ownership of Indonesian insurance companies and the OJK approval requirements for new controlling shareholders.

Key pre‑deal checks include:

• OJK licence status. Verify the target’s licence type (general insurance, life insurance, reinsurance or supporting business) and whether OJK has imposed any supervisory restrictions or sanctions.
• Capital adequacy and solvency. Review the target’s risk‑based capital (RBC) ratio and minimum equity position against the thresholds established by OJK Regulation No. 23/2023, which has progressively raised capital requirements for Indonesian insurers.
• Shareholder structure. Determine whether existing shareholders hold pre‑emptive rights and whether any single‑majority‑ownership provisions apply under the target’s articles of association (AD/ART).
• Fit and proper eligibility. Any party that will become a controlling shareholder, or any proposed new director or commissioner, must pass OJK’s fit‑and‑proper test, which assesses integrity, financial reputation and competence.

Foreign Ownership: Typical Ceilings and Routes

Indonesian insurance regulation permits foreign ownership of IBCs, but the permissible routes and effective ceilings differ based on the target’s listing status and company type.

For listed insurers, a foreign legal entity may acquire shares through the IDX. The government regulation on foreign ownership in insurance companies stipulates that foreign ownership shall be processed through stock‑exchange transactions. In practice, this means listed insurers are subject to IDX foreign‑ownership limits set by the issuer’s shareholder register, and any acquisition that triggers a change of control still requires separate OJK approval.

For unlisted insurers, a foreign legal entity may acquire shares through direct capital participation in the insurance company, purchase of existing shares from an Indonesian shareholder, or a combination of both. A foreign investor typically structures its holding through a PMA (Penanaman Modal Asing / foreign‑investment company) or invests directly where sector rules permit. The investor must identify a second shareholder, which may be an affiliated party, to satisfy the minimum two‑shareholder requirement under Indonesian company law.

Industry observers expect that the practical foreign‑ownership ceiling for most unlisted IBCs remains at 80 per cent, though specific government regulations and OJK policy may allow higher thresholds in limited circumstances. Prospective investors should verify the applicable ceiling for their specific transaction class with OJK or experienced Indonesian counsel before structuring any deal.

Step‑by‑Step Procedure for How to Acquire Shares in an Indonesian Insurance Company

The share acquisition process in Indonesia for an IBC follows a sequential, approval‑gated structure. Each step below identifies the responsible actor, the primary regulatory interaction and the typical time frame.

Step 1. Conduct Pre‑Offer Preparation and Vendor Due Diligence

Begin the due diligence checklist for insurance in Indonesia with a thorough regulatory and financial investigation of the target company.

1. Execute mutual non‑disclosure agreements (NDAs) with the seller and the target.
2. Request the target’s OJK licence history, latest RBC reports, audited financial statements (minimum three years) and a complete shareholder register.
3. Review the target’s AD/ART and any shareholders’ agreement to identify pre‑emptive rights, tag‑along/drag‑along clauses and board‑consent requirements.
4. Conduct a regulatory‑compliance search to ascertain whether OJK has issued any supervisory letters, sanctions or special‑measures orders against the target.

Who: Buyer’s legal and financial due‑diligence team, with support from local Indonesian counsel. Typical duration: 2–4 weeks.

Step 2. Negotiate the SPA and Draft Conditions Precedent

Draft and negotiate the share purchase agreement with a clear OJK regulatory condition precedent. The SPA should specify that completion is conditional upon receipt of written OJK approval for the change of ownership, and should include provisions for:

• Escrow of the purchase price, with release conditions tied to OJK clearance and MoL registration.
• A long‑stop date that accommodates both the OJK approval timeline (typically 8–12 weeks) and the subsequent MoL SABH verification window.
• Warranties from the seller confirming the absence of undisclosed OJK sanctions or pending enforcement actions.
• Arrangements for the notarial deed of share transfer, which must be executed before an Indonesian notary.

Check whether the target’s existing shareholders hold pre‑emptive rights that require formal waiver before the transfer can proceed.

Who: Buyer and seller counsel, corporate secretary, appointed notary. Typical duration: 2–6 weeks.

Step 3. File for OJK Prior Approval (Including Fit‑and‑Proper Dossiers)

This is the critical regulatory gate. Under Indonesian insurance law, any change of ownership in an IBC must obtain prior approval from OJK. The application pack typically comprises:

• An OJK cover letter using the prescribed template, setting out the transaction rationale, corporate profile of the acquirer and projected solvency impact.
• A certified copy of the executed SPA (or draft SPA, depending on OJK practice).
• Fit‑and‑proper dossiers for each incoming controlling shareholder and any proposed new director or commissioner. These dossiers include curriculum vitae, identity documents, a criminal‑record extract (SKCK), source‑of‑funds documentation and professional references.
• A solvency‑impact analysis demonstrating that the target’s RBC ratio will remain above the OJK‑mandated minimum post‑acquisition.
• A business plan where OJK requires disclosure of the acquirer’s strategic intentions for the insurer.

OJK reviews the application, frequently issues written queries requesting supplementary information and conducts its fit‑and‑proper assessment. The timeline for OJK approval is typically 8–12 weeks from the date the application is deemed complete, though this may extend if OJK requests additional information or if the fit‑and‑proper review is complex.

Who: Buyer, seller and OJK‑facing counsel prepare and submit; OJK reviews. Typical duration: 8–12 weeks.

Step 4. Execute the Notarial Deed and Submit to MoL SABH for Verification

Once OJK approval is received, the notary executes the deed of share transfer and, where the transaction amends the target’s AD/ART or shareholder composition, files the amendment through the MoL SABH online system.

Under Permenkum No. 49/2025, the MoL now performs substantive verification of corporate amendments submitted through SABH. This means the MoL may review supporting documents, including shareholders’ resolution minutes (RUPS), audited financial statements and the notarial deed itself, before approving the registration. If the MoL identifies discrepancies or missing documents, it may temporarily block the SABH filing until the issues are remedied.

The notarial deed must be uploaded to SABH within 30 days of execution, as required by Permenkum No. 49/2025. Missing this statutory window can trigger administrative sanctions and a temporary block on the company’s SABH access.

Who: Indonesian notary submits; MoL performs verification; buyer/seller counsel monitor. Typical duration: 2–6 weeks (MoL substantive verification may extend this period).

Step 5. Close the Transaction, Update the Share Register and Pay Transfer Taxes

With both OJK approval and MoL registration confirmed:

1. Release the purchase price from escrow.
2. Update the target company’s shareholder register to reflect the new ownership structure.
3. Pay applicable transfer taxes and stamp duties.
4. For listed IBCs, notify the IDX and the Indonesian Central Securities Depository (KSEI) of the ownership change.
5. File updated shareholder data with OJK to reflect the new ownership on the insurer’s licence records.

Who: Company secretary, escrow agent, tax advisor, OJK liaison. Typical duration: 1–2 weeks post‑approvals.

Step 6. Complete Post‑Closing Integration and Ongoing Filing Obligations

After closing, comply with the following ongoing obligations:

• Update beneficial‑ownership records with the MoL as required under prevailing beneficial‑ownership regulations.
• File any new board‑of‑director or board‑of‑commissioner appointments with OJK (fit‑and‑proper clearance required for each appointee).
• Submit annual corporate filings to MoL in accordance with Permenkum No. 49/2025, which introduced new annual reporting requirements for limited liability companies.

Who: Company secretary, compliance counsel. Typical duration: Initial filings within 30 days of closing; annual filings ongoing.

Timeline Summary Table

All durations are estimates based on prevailing practice. Timelines may extend where OJK requests additional information or where MoL substantive verification raises queries.

Required Documents Needed for a Share Transfer in the Insurance Sector

The documents needed for a share transfer in an Indonesian IBC span four regulatory touchpoints: the OJK application, the notarial deed, the MoL SABH filing and the tax authority. The table below consolidates the full checklist.

Deal teams should compile these documents in parallel with SPA negotiations to avoid delays once OJK approval is granted. The fit‑and‑proper dossier in particular often takes several weeks to assemble, especially where the incoming shareholder is a foreign entity requiring translated and apostilled documents.

Timeline for OJK Approval and Key Deadlines

The total elapsed time from initial due diligence to post‑closing filings typically ranges from 15 to 30 weeks, depending on deal complexity and the speed of OJK and MoL processing.

Two statutory deadlines are particularly important:

• MoL SABH upload deadline: The notarial deed must be submitted to SABH within 30 days of execution, as mandated by Permenkum No. 49/2025. Late submission may result in administrative sanctions or a temporary block on the company’s SABH account.
• OJK post‑closing notification: Updated shareholder data and any board‑appointment filings should be submitted to OJK within 30 days of closing, in accordance with prevailing OJK reporting requirements.

OJK does not publish a single statutory deadline within which it must decide an ownership‑change application; however, market practice indicates a processing period of 8–12 weeks from the date the application is accepted as complete. Complex transactions, particularly those involving fit‑and‑proper challenges, cross‑border source‑of‑funds investigations or capital‑adequacy concerns, may take materially longer.

Cost of Transfer of Shares: Fees and Tax Considerations

The cost of a share transfer in the insurance sector varies significantly by deal size, listing status and whether the acquirer is foreign or domestic. The table below summarises the principal cost categories.

All amounts are indicative. Buyers should obtain current fee schedules from OJK, MoL and their appointed notary before budgeting.

For corporate transactions involving unlisted shares, the capital‑gains‑tax obligation of the seller is a critical commercial point. The SPA should clearly allocate tax responsibility and, where applicable, provide for withholding‑tax mechanisms.

What Changes in 2026: Ministry of Law Verification Under Permenkum No. 49/2025

Permenkum No. 49/2025 (Minister of Law Regulation No. 49 of 2025) introduced a substantive‑verification requirement for corporate amendments filed through the MoL SABH system. Before this regulation, the MoL’s role was largely administrative, checking that mandatory fields were completed. Since the regulation took effect, the MoL reviews supporting documents in substance, including shareholders’ resolutions, financial statements and the notarial deed itself.

For parties seeking to acquire shares in an Indonesian insurance company, the practical effects are significant:

• Longer processing times. The MoL substantive‑verification stage now adds an estimated 2–6 weeks to the post‑OJK‑approval timeline. Early indications suggest that complex transactions, especially those with foreign parties, attract closer scrutiny.
• Additional documentary requirements. Permenkum No. 49/2025 requires notaries to upload a fuller set of supporting documents to SABH, including financial statements and evidence that the shareholders’ resolution was properly convened.
• New annual‑reporting obligations. Limited liability companies must file annual reports with the MoL under the new framework, creating an ongoing compliance obligation beyond the initial share‑transfer filing.
• Sanctions for non‑compliance. Failure to meet the 30‑day SABH upload deadline or to provide complete documentation may result in a temporary block on the company’s SABH access and administrative sanctions.

The MoL verification is distinct from the OJK fit‑and‑proper and ownership‑approval process. Both must be satisfied before a share transfer is fully effective. Deal teams should build the MoL verification window into their transaction timetable as a separate critical‑path item.

Common Pitfalls When Acquiring Insurance Company Shares and How to Avoid Them

• Attempting to close before OJK approval is received. Structuring the SPA with an OJK condition precedent and using escrow for the purchase price eliminates the risk of completing a transaction that is subsequently voided for want of regulatory clearance.
• Submitting fit‑and‑proper dossiers in non‑compliant format. OJK expects dossiers to follow its prescribed template. Foreign‑language documents must be accompanied by certified Indonesian translations. Begin dossier preparation no later than the SPA‑negotiation stage.
• Missing the 30‑day SABH upload window. Under Permenkum No. 49/2025, failure to upload the notarial deed within 30 days of execution can block SABH access. Appoint the notary early, agree a notarial‑deed execution date tied to OJK clearance and maintain an internal compliance checklist.
• Ignoring MoL substantive‑verification timelines. The MoL may now reject or return SABH filings that lack adequate supporting documents. Build a 2–6‑week buffer into the deal timetable and pre‑assemble the full MoL document pack before the notarial deed is executed.
• Underestimating tax exposure on unlisted‑share transfers. Capital‑gains tax at up to 25 per cent on net gain for Indonesian tax‑resident sellers, and potential withholding obligations for non‑resident sellers, can materially affect deal economics if not addressed in the SPA.

Sources

1. OJK, Law of Republic Indonesia on Insurance (Law No. 40 of 2014)
2. OJK, OJK Regulations Index
3. Peraturan.go.id, Permenkum No. 49 Tahun 2025
4. Sekretariat Kabinet, Government Regulation on Foreign Insurance Companies
5. Baker McKenzie, Insurance Regulatory Landscape and Key Considerations for M&A Transactions
6. SSEK Law Firm, New OJK Regulation on Insurance Products and Marketing
7. ABNR, OJK Reg. 36/2024: What’s Changing for Insurance Operations