Since the Office of Insurance Commission (OIC), Thailand's insurance regulator, has revealed that its direction and operations are now stable and secure, and also adaptable to risks and changing environments, it will turn its attention to the inspection and supervision of insurance companies through the examination form assessment, according to deputy secretary-general for legal and auditing Adisorn Pipatvorapong.
The regulator has assigned the inspection team, which will be lead by OIC assistant secretary-general for inspection Soraj Raksakulchai. The team will develop the examination form assessment to be used in the performance evaluation of the board of directors, subcommittees and internal supervision units of insurance companies, in terms of compliance with the law of the insurance companies that must operate under the OIC.
According to the OIC, the assessment form has been developed to include questions that reflect the performance of personnel to ensure that insurance companies have appropriate risk management and internal control systems. It will also ensure that various systems work efficiently, have checks and balances, aim to enhance transparency, have good corporate governance and supervise fair treatment of policyholders.
These area leads to stability, security, adaptability and a sense of awareness of risks and changing environments among insurance companies.
Mr Pipatvorapong stated that the examination form will be evaluated in nine sections:
- Board of directors
- Audit committee
- Risk management committee
- Insurance product committee
- Investment committee and credit committee
- Internal audit unit
- Risk management unit
- Actuarial unit
- Compliance unit
The examination form will be sent to insurance companies to prepare every quarter. Starting from the first quarter of 2025 onwards, insurers are required to complete and submit the assessment to the OIC.
In order for the assessment to be effective and reliable, the OIC requires that some questions require the company to attach relevant documents to the questionnaire. In addition, the assessment results of the examination form of the company’s essential internal control units must be considered by the overseeing subcommittees and signed by the relevant chairpersons to certify the results.
As for the assessment results of the subcommittees and the board of directors, the board of directors must consider the answers. The assessment results of all examination form categories must be circulated to all board members for consideration and approval, and the chairman of the board of directors must sign to certify the answers to the OIC.
The OIC, through the audit team, will collect the assessment results to use in assessing the risks of insurance companies together with other tools currently available in the audit team, such as the corporate self-assessment form to determine measures for monitoring and supervision according to the risks of the insurance company.
“The result of upgrading the inspection and supervision of insurance companies through the examination form assessment will not only provide the OIC with an effective tool for monitoring and inspecting according to risks, but also provide insurance companies with a tool for monitoring and evaluating the performance of the board of directors, subcommittees and internal control units on a quarterly basis,” said Mr Pipatvorapong.
“It is also an opportunity for the company to review its performance and improve the performance and responsibilities of the board of directors to benefit the company with maximum efficiency and effectiveness, as well as being a preventive measure for the company’s unlawful practices.”
He also said, “In addition, upgrading the inspection and supervision of insurance companies through the examination form assessment will help the insurance industry have standards and practices for the performance of the board of directors, subcommittees and internal control units that are in line with international standards, which will benefit the stability and security of the insurance industry in the long term.
“Importantly, it can prevent problems of systemic risks, reduce negative impacts on business operations that will lead to damages to policyholders and the public in the future, and help build confidence among policyholders, the public and stakeholders in the insurance industry.”