• 
• 

Published on January 11, 2008

"But don't expect the same level of growth as last year's", said chief executive Apirak Thaipatanagul. "Last year, because of a decrease in interest rates and some key competitors exiting the single-premium market, revenues just shot up. And we couldn't brake."

Income from single-premium products could be halved due to a likely hike in savings interest rates.

This means that more innovative products - such as a five-year index-linked insurance product - may fill in the market gaps.

The company looks to increase new policyholders by 500,000 contracts, said president Chai Chaiyawan. But of the Bt29-billion sales goal this year, only Bt6.5 billion would be from first-year premiums, with the remaining Bt22.5 billion from existing customers.

The cash cow continues to be the upcountry market, which is double the size of the urban market, said Chai.

With future challenges on a global scale - the Commission for Regulation and Promotion of Insurance Business Act 2007 having increased the foreign-ownership limit from 25 to 49 per cent - Chai likens the market situation to a pot of gradually boiling water and the insurance companies to frogs.

"If we continue to sit around like this, we'd be cooked," he said.

Thailand's second-largest insurance company has been doing some brand finessing, too. Chai cited recent research conducted by the company that found that most people already know how insurance works, but they cannot differentiate one product or service from another. So Chai set about transforming the whole organisation, starting with job titles.

"An insurance agent will now be known as a 'Life Planner'," he said. It might appear just to be semantic, but Chai said his new sales force were not simple financial advisers.

Although the company's investment yield has dropped from 5.29 per cent previously to 4.8 to 4.9 per cent, Thai Life will continue to focus on debt investments, putting equity on its hind legs. The current return is still better than bonds, said Apirak.

Ki Nan Tsui

The Nation