The Central Administrative Court dismissed a Bt40 billion lawsuit today, which had been filed against the Office of the Insurance Commission by Syn Mun Kong Insurance Public Company.
The case was over the commission’s order banning the company from cancelling its “COVID 2 in 1” (jer-jai-job) insurance policies, which were sold to about one million customers during the height of COVID-19 pandemic in 2021.
The case dates back to mid-2021, when Syn Mun Kong distributed notifications to its customers, who had bought the COVID coverage, that such policies would be cancelled because they were causing serious damage to the company by having to shoulder the financial burden of the compensation being demanded by the insured.
The company’s abrupt decision caused widespread panic among the customers of other insurance companies who had purchased similar coverage. Protests also erupted among customers of Syn Mun Kong.
To allay the panic, and to prevent other insurance companies from following in the footsteps of Syn Mun Kong, the commission issued order 38.2564, banning all insurance companies from cancelling their COVID insurance policies.
These policies were estimated to place a liability of about 100 billion baht in compensation, covering 16 million insurance policies, on the entire insurance industry.
All the 16 million insured were protected by the order, until the expiry of their policies.
In its ruling, the court noted that, if Syn Mun Kong could get away without paying compensation to the insured, it could set a precedent for insurance companies to evade their compensation commitments in other insurance policies.
