Indonesia: Companies to reassess the impact of spinning- off Syariah windows following recent regulatory updates

In Indonesia, insurance compliant with Syariah principles can be sold through either a Syariah business unit or “window” of a conventional insurance company or, less commonly, through a standalone Syariah insurance company. This e-Alert discusses how the draft Otoritas Jasa Keuangan regulation to amend Regulation No. 67/POJK.05/2016 and Government Regulation PP No. 3/2020 provide some clarity on previous areas of uncertainty, together with their potential impact on insurers’ decision to spin off their Syariah windows or exit the Syariah market.