An Integrated Recovery Framework For PKU Exit: A Case Study of an Indonesian Sharia Life Insurer

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Wachjono, Wachjono (2026) An Integrated Recovery Framework For PKU Exit: A Case Study of an Indonesian Sharia Life Insurer. Masters thesis, IPMI Institute.

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Abstract

PT Asuransi Jiwa Syariah XYZ is a standalone Islamic life insurance company in Indonesia that has been subject to the Business Activity Restriction (Pembatasan Kegiatan Usaha/PKU) imposed by the Financial Services Authority (Otoritas Jasa Keuangan/OJK) since November 2021. These restrictions on business activities relate to three areas: equity deficiency, solvency constraints and requirements for fulfilling the composition of the Board of Directors and Actuary. This thesis was prepared to provide input on resolving the issues by proposing a development of integrated recovery framework. This research uses a qualitative single embedded case study which is theory driven by four theoretical perspectives; Institutional Theory, Financial Distress Theory, Agency Theory and Stewardship Theory. The analysis is based on the Company audited financial statements since 2024, OJK regulations and documents, records of internal governance mechanisms and a written semi-structured expert questionnaire filled out by five senior institutional informants from the Controlling Shareholder, Board of Commissioners and Executive Management. Analysis used a deductive thematic approach (with minimal inductive refinement) and triangulated evidence across financialisation, regulation, governance and survey sources. The findings suggest that the prolonged PKU of XYZ is likely to be associated with three interrelated conditions: persistently negative equity, challenges in demonstrating the regulatory solvency of the Company Fund, and incomplete governance functions required to implement effective financial and regulatory recovery. This study specifically shows that the Company Fund and Tabarru' Fund are distinct so regulatory issues must be managed holistically rather than a piecemeal approach. Based on these findings, we outline an Integrated Recovery Framework (IRF) which may enhance coordinated pathways for PKU exit through restoration of governance and equity along with solvency & financial health & regulatory compliance. This framework shall be characterised by an overriding governance function, the restoration of shareholder equity, correction into an actuarially sustainable financial-health position and the execution of OJK's regulatory normalcy requirements. The IRF described here, which has not yet been evaluated externally (let alone implemented), is a proposed recovery design for XYZ and a possible case-based guide for other insurers in a similar situation; we make no claims about its effectiveness.

Keywords: Sharia Life Insurance; Business Activity Restrictions; Administrative Recovery.

Item Type:	Thesis (Masters)
Subjects:	H Social Sciences > H Social Sciences (General)
Divisions:	Thesis > Master of Business Administration
Depositing User:	sandra margaretha
Date Deposited:	16 Oct 2026 08:04
Last Modified:	16 Oct 2026 08:04
URI:	http://repository.ipmi.ac.id/id/eprint/3078

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