Life insurance industry’s income to grow more strongly this year
THE Thai Life Assurance Association has projected that premium income this year will grow by 6 per cent to Bt600 billion, up from last year’s 5.7 per cent, as low interest rates encourage insurance companies to move into investment-linked products and those that target specific customer segments.
Life insurance industry’s income to grow more strongly this year
THE NATION
Last year, many life-insurance firms shifted to protection insurance because savings policies had become less attractive from the ongoing low interest rates, but the premiums of protection insurance are much lower than for savings policies. Premium income of the life-insurance industry last year expanded by 5.7 per cent to Bt568.26 billion.
Nusara Banyatpiyaphod, president of the association, said that as long as interest rates stayed at their current low levels or increased only slightly, several firms would have to focus more on investment-linked products.
Consumers today have more understanding of insurance and financial planning. Insurance policies that can generate high returns together with life protection will be their choice. Meanwhile, the rising costs of medical treatment are adding to consumers’ worries.
Long-term plan
She said several insurance companies were also focusing on long-term premium-payment plans to deal with the economic circumstances, under which customers might not be able to afford one-time payments.
The digital age will play a stronger role in the insurance industry, so upcoming products will be simpler so people can purchase them via digital channels.
All of these factors should ensure that the insurance industry keeps on a growth path amid the slow economic recovery, Nusara said.
She said the government policy to enhance the domestic economy would be positive for incomes of consumers, while the low life-insurance penetration rate was still providing opportunities for her industry.
Regulations have been amended to support the insurance business’ transformation to digital technology, as well as policies targeting particular customer segments.
Moreover, the expansion of insurance companies’ investment in Asean countries and beyond in the form of joint ventures and branches will also contribute to their revenue growth.
