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TUESDAY, October 04, 2022
Ailing insurers ordered to stop issuing non-life policies, put house in order

Ailing insurers ordered to stop issuing non-life policies, put house in order

THURSDAY, March 17, 2022

Thailand’s insurance industry regulator has ordered Southeast Insurance and Thai Insurance to suspend sale of non-life policies and rectify their financial position within the stipulated timeframe.

Both companies have been facing financial difficulties due to the massive claims for Covid-19.

They were among the Thai insurance firms that started selling policies for Covid-19 infections in 2020 when the number of domestic cases was low. Under a so-called “found and paid” format, those policies typically offered to pay as much as 50,000 baht to any policyholder infected with the coronavirus for premiums as low as THB300.

The Office of Insurance Commission has issued a nine-point directive to Southeast Insurance and Thai Insurance for urgent implementation in order to ensure their customers would not be affected by their financial problems, the agency’s secretary-general, Suthiphon Thaveechaiyagarn, said on Thursday.

He said conditions have been set by the commission’s board for both firms to comply so as to prevent damage to their customers and the public.

Both firms were ordered to suspend non-life insurance, ensure adequate funds to meet their legal obligations within 30 days, urgently proceed with the authorised sale of their assets to repay their policyholders, accelerate insurance payments, and arrange sufficient staff to handle claims.

The order was issued after the commission found that the financial positions of Southeast Insurance and Thai Insurance were unstable, with liabilities in excess of assets.

Earlier, the agency had closely monitored their financial status and held many meetings with representatives of both companies, according to Suthiphon.

Southeast Insurance and Thai Insurance have partially kept their promise of refunds for insurance coverage against Covid-19 infections in exchange for their customers’ voluntary cancellation of their insurance policies.

Also, their plans to transfer insurance policies to other insurers have not been completed, causing many customers to file complaints about payment delays.