Thailand's insurance regulator, the Office of the Insurance Commission (OIC), has issued policy directives that emphasise the stable and transparent development of the Thai insurance industry.
According to a statement from the OIC, the industry should also be able to adapt to changing risks that characterise these times.
“This will be achieved through risk-based supervision and the enhancement of corporate governance among insurance companies, ensuring effective and fair protection for policyholders,” the statement said.
To that end, the regulator has noted that it is prioritising the development of products and market mechanisms that reflect modern risks, such as promoting named driver motor insurance and developing a no-claim bonus structure to incentivise safe driving behaviour.
“Furthermore, the implementation of co-payment systems in health insurance will help manage rising medical costs, coupled with the development of a national health database to support long-term policy formulation,” the statement added.
Regulatory oversight
Touching on regulatory oversight, the OIC noted the development of modern tools, such as the integration of data from enterprise risk management (ERM) and own risk and solvency assessment (ORSA), as well as the creation of a ‘risk heatmap’ to enhance predictive governance.
According to the statement, the regulator is also “considering adopting a risk-based grading framework in the Thai context”.
Additionally, the OIC clarified its direction for revising key regulations, such as requiring insurance premium payments to be made directly between policyholders and insurers in order to increase transparency and reduce risk from intermediaries, with the regulation due to come into effect in 2027.
“The OIC is also reviewing and improving the product governance process to make it more efficient while maintaining consumer protection standards,” the statement added.
“Regarding disaster risk, the OIC is studying ways to strengthen the insurance system, such as developing a national disaster fund or exploring industry-level risk diversification models to mitigate losses from large-scale events and enhance long-term system stability.”