Thai insurance regulator urged to rescind order forbidding cancellation of COVID insurance policies
The Thai General Insurance Association is urging the Office of Insurance Commission (OIC) to rescind its order forbidding insurance companies from cancelling the so-called “Found, Paid, Done” policies covering COVID-19 infection, claiming that it may force insurance companies in Thailand into bankruptcy.
The association president, Anon Vangvasu, said that insurance companies may have to turn to the Central Administrative Court to seek emergency protection if the order is not revised.
He pointed out that insurance claims under these policies, which currently amount to about 37 billion baht, accounting for 26.5% of the Insurance Fund, and which are likely to increase to 40 billion baht, or about 30%, could, if there were a new wave of the COVID-19 pandemic, overwhelm the Insurance Fund.
The association president explained that, for every insurance policy, there are conditions which allow both the insurance companies and the insured to cancel their policies, noting, however, that most insurance firms have not cancelled the policies unless it is absolutely necessary.
Anon claimed that cancellation of the “Found, Paid, Done” insurance policies, however, is necessary because the insurance claims have far exceeded the capacity of the insurance fund to cope, adding that insurance companies have not excessively insured against COVID-19, because the virus is a new emerging disease, so there is no statistics for reference.
Regarding the delay in settlement of claims, he said companies are now improving their systems and are securing fresh funding to honour the claims.