GPF, insurers craft plan for retirees

“We didn’t set a target for how many members will buy the retirement products. It’s the first time that we and our partners have encouraged members to be more careful in budgeting their expenses and to consider purchasing an annuity early in retirement,” Sopawadee Lertmanaschai, secretary-general of the GPF, said yesterday.

The retirement life-insurance products are designed to encourage consumers to save more so that they can look forward to a comfortable standard of living, instead of relying solely on their pension.

About 150,000 GPF members have purchased both life and non-life products to provide financial security in their golden years. 

The number of policyholders is greater than the number of GPF members, as one member can buy more than one policy. 

The members hold 765,925 life insurance policies worth Bt114.5 billion and 100,204 non-life policies worth Bt225 million. 

The ageing of society is forcing the GPF to pay more attention to the long-term savings of its members, while the government has raised the personal income tax deduction for insurance premiums to Bt300,000.

The four partners are Thai Life Insurance, Muang Thai Life Assurance, AIA Thailand and Dhipaya Life Assurance.

GPF members who purchase retirement life-insurance products will enjoy a special premium rate and high return after the policy matures. 

Some of the companies are extending the annuity payment period until the policyholders reach the age of 90. The annuity payment from those life insurers will average 12-15 per cent of the insured amount. 

Policyholders will also enjoy an annual tax deduction of Bt300,000. 

The GPF has urged members to buy more retirement products when they are young to enjoy cheaper premiums than their seniors. However, people may ignore retirement policies until they are near retirement, Sopawadee said. 

Sarun Limhiranrak, chief executive officer of Dhipaya Life Assurance, said it expected to earn premiums of Bt500 million from the programme.