Thailand: Policyholder protection fund running out of money
Source: Asia Insurance Review | May 2024
The General Insurance Fund (GIF), whose purpose is policyholder protection, has said that it must postpone compensation to policyholders of insurance companies that have had their licences revoked.
On 26 March, the GIF said that it had only THB3m ($82,670) remaining in its coffers and that it would resume paying compensation until additional money could be found. It is waiting for contributions from insurance companies that are expected in July 2024, reported the newspaper ThaiRath.
The GIF explained in a statement that it had to handle sudden losses incurred by insurers which collapsed because of their sales of COVID-19 insurance policies.
In 2023 and up to February 2024, the GIF paid affected policyholders an average of THB350m-400m per month, equivalent to 7,000 - 8,000 insurance policies per month. The Fund’s compensation burden is around THB60bn and there are more than 600,000 policyholders who are eligible to receive compensation.
The GIF was established in accordance with the General Insurance Act of 1992 to protect policyholders who have the right to receive insurance payments from it if their insurance company’s business licence is revoked. The purpose of the Fund is to ensure security and stability in the sector. A