Password Policy Manager (PPM) older than 5.9.5 does not support LSA being enabled on DCs. The component will fail perform its regular functions (e.g. interact with PM’s password policies).
Upgrade Password Manager to v5.9.5 and apply below Cumulative Hotfix:
Password Manager 5.9.5 cumulative hotfix (331767) (oneidentity.com)
Disable LSA from the DCs running the PM’s Password Policy Manager (PPM).