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Health insurer law in focus

by qualityeducation

Health insurer law in focus

Details under study by Chula analysts

Front-line medical workers perform a nasal swab test for Covid-19 at a hospital. The health insurance market grew 7% in the first half of 2020 on raised concern over health issues.  Bangkok Post

The Office of Insurance Commission (OIC) will propose a new law overseeing health insurers in light of rapidly growing health concerns surrounding the pandemic.

The health insurance law is being studied by Chulalongkorn University and is expected to be drafted and proposed to related parties this year. The law will regulate voluntary-based health protection insurance.

OIC secretary-general Suthiphon Thaveechaiyagarn said health insurance grew 7% in the first half while life insurance shrank 3.3%, driven by raised health protection awareness caused by Covid-19 and the higher expenses of health and medicine.

“Health protection is a high-growth product,” he said. “We should have a mechanism to shape the future to grow in the right direction like in many countries.”

He said focusing on protection products can also help insurers survive under low-interest rates. Many new international standards require capital reserves based on risk and long-term obligations such as endowment and products that guarantee a return rate.

“We may have consumer rights protection in this law,” Mr Suthiphon said. “Clear rules and guidelines are building people’s confidence and ushering in more health protection.”

He said the law will also make health insurance offered to the public consistent, whether it is offered by life or non-life firms.

Today, non-life insurers can sell critical illness protection as a standalone product, while life insurers are required to include a major life insurance policy in the package. Therefore, the overall premium value is typically expensive relative to the standalone.

The difference is due to the law stating that life insurance is based on the “viability of the insured”.

Mr Suthiphon said this definition will be reviewed as well.

Thailand has two laws regulating the insurance industry: the Life Insurance Act and the Non-life Insurance Act.

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