Thai insurance sector primed for regional expansion as Asean market opens up
The Thai insurance sector is gearing up for regional expansion under the Asean Framework Agreement on Services, according to the Office of Insurance Commission (OIC).
OIC joined hands with EY Corporate Services on Thursday for a seminar aimed at sharpening Thai insurers’ competitiveness as regional markets open up.
A recent study found that the Thai insurance sector was in good health, with most companies financially stable with strong foundations and potential for growth, OIC secretary-general Suttipol Taweechaikarn said. They also benefit from their wide range of products and selling methods, he added.
Moreover, the strong reputation of Thailand's medical services has boosted business among foreigners buying Thai insurance and receiving medical treatment in the Kingdom, according to Suttipol.
Meanwhile the “new normal” era of increased online commerce provided opportunities for Thai insurers to sell their products online in other countries.
However, Suttipol urged the government to ease the limit on foreign shareholders so as to boost competitiveness of Thai insurance companies via investment. This would also strengthen bonds between Thailand and its neighbours while increasing choice for consumers and helping the economy to grow, he said.
Most of the seminar participants agreed that easing the foreign shareholding limit of 25 per cent would increase capital for Thai insurers and aid transfer of expertise and technology plus development of new products.
They also agreed that Thai vehicle, health, accident, and personal lines insurance was well set to meet demand in the Asean market.
Suttipol noted that the current foreign shareholder regulation is flexible in line with World Trade Organisation rules, with the limit lifted to 49 per cent in special cases. However, any decision to change the limit should take into account the readiness of the Thai insurance sector, he cautioned.