The Office of Insurance Commission, under the supervision of the
Ministry of Finance (OIC) regulates insurers, brokers and
Both are permitted for an insurer; however the OIC's current
policy is not to grant new licences for either on the basis that
the insurance company market requires consolidation.
Brokers must establish a legal entity in Thailand.
Only individuals can be insurance agents.
Insurance and reinsurance companies:
up to 25 per cent less one share permitted
up to 49 per cent with approval of the OIC
above 49 per cent with approval of the Minister of Finance
Brokers can be 100 per cent foreign owned, but if > 49 per
cent they need a licence under the Foreign Business Act.
A change of ≥ five per cent shareholding must be notified
after the event to the OIC.
A change in directors must be approved by the OIC.
THB32.7 = USD1 at 1 January 2014
Risk based capital
Yes – Eligible Capital/Risk Capital Requirement x 100 per
cent = minimum capital requirement.
Eligible Capital is equity, share premium, retained profits,
preference shares, etc. less certain deductions. Assets are valued
at market value with adjustments.
Risk Capital Requirement is liabilities (calculated on a best
estimate basis) plus capital charges for insurance risk, market
risk, credit risk, concentration risk.
Solvency margin: minimum capital requirement of 140 per cent
(effective from 1 January 2013).
Yes. The General Insurance Fund and the Life Insurance Fund
(funded by industry levies) assist policyholders of non-life and
life insurers respectively in the event of insolvency or revocation
of insurance licence. Payments are limited to THB1 million.
Prior to claiming from the relevant fund, policyholders must
first bring a claim against the insurer and, in insolvency
proceedings, the policyholder will have priority over other
creditors against any securities and unearned premiums reserves of
the relevant insurer placed with the OIC.
Insurer may not outsource "core" functions, which
include: risk underwriting & issue of policy, collecting
premiums, accepting or rejecting claims and loss adjustment. With
specific approval of the OIC, insurer may outsource certain
"support" functions, which include: paying claims under
limited circumstance. Insurer may freely outsource
"other" non-core administrative functions, which include:
Internal audit, accounting, IT and advisory services in respect of
claims and back office functions.
*as at 1 January 2014
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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The failure of a party to call a witness does not necessarily give rise to an adverse inference being drawn in accordance with Jones v Dunkel (1959) 101 CLR 298. An unfavourable inference is drawn only if evidence otherwise provides a basis on which that unfavourable inference can be drawn.
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