Indonesia has sanctioned 32 companies over forest and land fires covering nearly 13,000 hectares, while widening criminal investigations to identify beneficial owners who may ultimately carry responsibility for the damage. For plantation operators, agribusinesses and their brokers, the enforcement campaign is a live test of whether corporate insurance programs were designed to absorb the full range of exposures now in play.
The Ministry of Forestry’s enforcement action includes permit suspensions, mandatory ecosystem restoration and permit revocations. Nineteen companies face permit suspensions alongside restoration orders, eight face restoration orders alone, and five have had permits revoked. The affected area spans approximately 12,927 hectares across seven provinces.
Criminal proceedings involve 125 individuals and corporate entities, with 12 individual suspects and one corporate suspect identified to date. Dwi Januanto Nugroho, the ministry’s director general of forestry enforcement, said investigations were examining whether beneficial owners connected to affected concessions should also be held accountable.
The approach Indonesia is taking allows administrative, criminal and civil proceedings to arise from the same incident simultaneously. Alongside restoration orders and permit revocations, authorities have indicated that civil compensation claims remain open where investigations establish clear liability.
Previous litigation sets the financial scale. In July 2025, Indonesia’s Ministry of Environment announced court awards exceeding Rp721 billion in environmental damages across four separate forest and land fire cases. One judgment also ordered restoration valued at Rp1.79 trillion. These cases are at different legal stages and separate from the latest enforcement action, but they establish the quantum that the current proceedings could reach.
Corporate insurance programs for plantation operators typically include environmental liability, D&O and business interruption components, but the structure of Indonesia’s enforcement creates exposures that do not map neatly onto standard wordings.
Environmental liability policies may cover certain pollution-related clean-up costs and third-party claims, but statutory restoration obligations, regulatory penalties and losses from permit cancellations are likely to fall outside coverage. D&O policies may respond to claims involving failures in environmental oversight or regulatory compliance, but defence expense coverage does not automatically extend to corporate remediation obligations or statutory penalties.
Brokers with plantation sector or agribusiness clients in Indonesia should be reviewing whether programs explicitly address restoration orders, whether D&O wordings cover regulatory investigation costs across multiple jurisdictions, and whether business interruption cover responds to permit suspension rather than only physical damage.
The enforcement campaign now extends across borders. On October 19, Singapore’s National Environment Agency issued preventive notices to three additional Indonesian companies under its Transboundary Haze Pollution Act, bringing the total targeted to 10. The notices require fire suppression and prevention measures and do not constitute findings of legal liability, but they demonstrate how a single forest fire incident can generate regulatory scrutiny in multiple jurisdictions simultaneously.
Haze-related disruption also creates secondary BI exposure for logistics, manufacturing and other businesses reliant on regional transport networks - losses that conventional BI policies, requiring insured physical damage as a trigger, may not reach.
