Clients with palm oil or plantation exposure in Indonesia now carry two distinct risks that rarely land in the same renewal file, and this week put both in front of the same companies.
One is political: a state crackdown that has already put land the size of Belgium into government hands. The other is seasonal: fire and haze season, now at its worst pace in over a decade.
A broker sitting across from an exposed client has reason to raise both, since neither is well covered and one already has a product on the shelf.
Since early 2025, a task force of military personnel, prosecutors and environmental regulators has been seizing plantations and mines that authorities say sit inside forest areas. By April, it had taken over 5.88 million hectares (14.5 million acres) of oil palm plantations, according to Attorney General Sanitiar Burhanuddin - nearly twice the size of Belgium.
President Prabowo Subianto put the value of assets confiscated so far at close to $22 billion. Burhanuddin had already flagged another $8.5 billion in potential fines from the crackdown late last year.
Prabowo has since ordered prosecutors to file criminal charges against companies that refuse to cooperate, saying "those who do not want to cooperate, prosecute them. We will not hesitate and we will not be intimidated."
Thirty-four companies have filed objections, arguing the seized land area is overstated - a live dispute touching any political risk, trade credit or asset cover placed for these accounts.
Sunday's 72 arrests connect to 89 forest and land fire cases across five provinces on Borneo and four on Sumatra, the National Police's Criminal Investigation Agency said.
Mohammad Irhamni, director of special crimes at the agency, said plantation owners and farmers burn land to cut clearing costs, and investigators are examining financial records to establish whether companies funded or ordered the burning.
"We will not stop at the perpetrators on the ground," Irhamni said in Jakarta on Sunday. "We will determine who benefited from these activities and who was ultimately behind them."
Arrested suspects face penalties from fines to 15 years in prison, while at least four companies in West Kalimantan are under investigation for allegedly using fire to clear land, Prasetyo Hadi, head of the State Secretariat, said, with proven intent risking revocation of their operating permits - the kind of finding that can turn a property claim into an intentional-acts coverage dispute.
Irhamni's line about identifying who "benefited" and who was "behind" the fires has a legal hook, even an untested one. Indonesian law allows for indirect liability against financiers who knowingly fund environmentally destructive activities, though legal commentary notes this provision has rarely reached Indonesian courts.
A 2026 study in the Jambe Law Journal also found Indonesia's mandatory environmental liability insurance currently applies only to hazardous-waste operators, and proposed extending it to plantations - a gap most plantation clients still sit inside.
An intensified El Nino pattern and extended dry season have fueled the fires, and dense smoke has crossed into Malaysia, according to Indonesia's National Disaster Management Agency. Prabowo traveled to Central Kalimantan on Saturday, where more than 7,600 hectares (18,700 acres) have burned.
Fire hotspots nationwide have surged to their highest level in over a decade: more than 3,500 recorded this month alone, over four times July's total and the highest August count since 2015, per the Forestry Ministry's SiPongi platform.
The Environment Ministry recorded over 3,700 hot spots on Borneo and 1,700 in South Sumatra on Sunday, where visibility fell to 10 meters (33 feet) in places.
BNPB chief Suharyanto said fire activity has increased across West, Central and South Kalimantan, where peatland prolongs the haze; fires that appear "extinguished on the surface may still contain embers underneath, so sufficient rainfall is crucial to rewet the peat and fully suppress the fires." Cloud-seeding resumed Sunday, 30 helicopters over Kalimantan and 22 over Sumatra.
Malaysia's Sarawak state has felt it too; one district posted "very unhealthy" readings on Friday and eight others posted unhealthy readings.
Almost 600 schools closed, and about 200,000 students were affected, according to the Sarawak government - disruption reaching any client with staff or supply chains there, not only those holding Indonesian land.
Swiss Re Corporate Solutions still offers HazeShield, a parametric product paying Singapore businesses for cash-flow losses from severe haze, triggered by pollution-index readings rather than physical damage or loss adjustment.
Per the Swiss Re Institute, Singapore alone lost an estimated $386 million to the 1997 haze event and $897 million to the 2015 event. A product for the disruption side of haze has existed for years; the political-risk conversation is what's missing.
