Thanasin Insurance's current liabilities total Bt500 million, up from Bt400 million, according to the Insurance Department.

Boon told The Nation's sister publication Krungthep Turakij that the level was "still acceptable". Nevertheless, if liabilities increase further, he will scrap takeover plans, he said.

"We are okay with liabilities up to Bt500 million. Under the capital-increase plan, we will inject about Bt100 million to Bt200 million," he said.

The department suspended Thanasin Insurance in mid-March after it failed to maintain required levels of capital funds.

The Non-Life Insurance Act requires that general insurers maintain capital funds equivalent to 10 per cent of premiums, but not less than Bt30 million.

Boon told the department his group required until June 10 to settle takeover details. He will offload Thanasin Insurance once he turns it around.

"When we complete rehabilitation we will sell the company for between Bt300 million and Bt400 million. We don't want to engage in the insurance business.

"But we do want to revive the company for the long-term sake of the country," he added.

Meanwhile, Thai Vivat Insurance will increase its overseas investments through mutual funds. This is after it saw first-quarter returns on investment fall 82 per cent as a result of poor domestic stock-market performance.

The company has already shifted Bt500 million into overseas mutual funds and returns are running at between 14 per cent and 15 per cent.

It has another Bt400 million in government and corporate bonds and debentures.

President and chief executive Jiraphant Asvatanakul said second-quarter returns would outperform those in the first quarter once dividend payments are booked.

"Because of insurance-market competition the company earned less in premiums. It was forced to lower charges to keep customers," Jiraphant said.

"Profit is down between one and two per cent, as is the average premium received per policy. We have to make profit from investments in order to maintain performance," he said. Jiraphant said that company aimed to increase premium renewals to 55 per cent from the current 40 per cent.

It will offer a new third-class motor-vehicle insurance policy soon and is talking with personal-finance companies about distributing policy applications.

Motor-vehicle insurance accounts for 70 per cent of the company's business.