Thailand’s non-life insurance industry experienced a significant rebound in 2023, driven by higher premiums and a reduction in claims, particularly in the health and hull insurance sectors, according to a report by AM Best.
The market recorded an underwriting gain of THB 13 billion ($380 million) in 2023, a remarkable recovery from the previous year’s net underwriting loss of THB 50.7 billion ($1.48 billion).
Motor insurance continued to dominate the sector, accounting for 57% of direct premiums in 2023. This growth was primarily fueled by a rise in domestic car sales, with electric vehicles seeing particular demand. AM Best highlighted that six out of the ten leading non-life insurers derived more than half of their direct premiums from motor insurance.
Health insurance, which ranks as the fourth-largest segment, also contributed to the overall premium growth. However, it saw two years of decline in direct premiums after a surge in 2021. The decrease was attributed to factors such as medical inflation, increased co-payment limits on standard personal health policies, and financial challenges faced by insurers due to claims from low-cost COVID-19 lump-sum policies.
The underwriting losses in 2022 led to a significant drop in capital for non-life insurers. However, capital levels improved in 2023, driven by stronger profitability. Despite this, some insurers continued to experience financial difficulties, prompting regulators to implement temporary liquidity measures.
While premium growth remained steady in 2023, it was largely flat in the first three quarters of 2024.
The exchange rate used is $1.00 = THB 34.27.
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