Fulfilled car orders, GIA
Resumed delivery of cars to buyers and a rebound in the purchase of machinery enhanced growth in general-insurance premiums in the first quarter of the year, and the General Insurance Association forecasts that total premiums will achieve the full-year ta
Jiraphan Asawathanakul, chairman of the association, said yesterday that the non-life-insurance industry in the first quarter had seen an improvement over the fourth quarter of 2011. The increased sales derived from auto-makers gradually resuming deliveries to customers after suspending them for months because of the flood crisis.
However, premiums in the first quarter of this year were not as high as in the same period last year, as March was the only month that saw sales jump. Auto insurance accounts for 65 per cent of non-life premiums.
He said the association estimated that income in the second quarter would be higher than in the first three months of the year, resulting from a boom in auto sales during the 33rd Bangkok International Motor Show that ended on Sunday.
In addition, manufacturers have ordered new machinery to resume their production capacity and business expansion. They also have to purchase insurance.
The government’s Disaster Insurance Promotion Fund, which kicked off late last month, will attract manufacturers and high-risk businesses to buy more coverage. The association is confident premiums this year will grow by 15-20 per cent to Bt160 billion.
Kasikorn Research Centre estimates that 150,000 vehicles were ordered last year that could not be delivered to customers. It is expected that all these orders will be fulfilled by next month. Auto producers are expected to be back up to full production capacity by June, so sales this year should reach 1 million units, which means auto-insurance premiums should increase by 10 per cent.
Car and other non-life insurance accounts for 90 per cent of the industry’s total premiums. Rising risk coverage, including disaster insurance, will increase the proportion to 93 per cent.
KResearch predicts that premiums for non-life insurance this year will grow by 18-20 per cent to between Bt165.50 billion and Bt167.50 billion from Bt139.83 billion in 2011.
