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Published on March 18, 2008

Samphan, formerly the country's leading non-life insurer, has failed to maintain its insurance fund as required by law and pay claims since June 2005. The OIC ordered the suspension of its operations last July.

The firm says it is negotiating with three new buyers - one foreigner and two Thai investors - to inject fresh capital for further operations.

 "The office will give Samphan until the due date to close the deal, in order to ensure that all policyholders of the firm will be paid after the firm corrects its financial status," said OIC secretary-general Chantra Purnariksha.

She explained if the office immediately ordered the company to shut down, thousands of policyholders would suffer losses, because the firm would be unable to find the money to pay all claims.

If the company fails to make the deal, Chantra said the OIC would propose legal action against Samphan that would lead to a permanent withdrawal of its licence.

The office's statistics show only 20 per cent of policyholders have been paid since the insurance firm was ordered to halt operations.

Chantra is optimistic this last opportunity the office is offering to Samphan will result in a win-win outcome for both the insurance firm and thousands of policyholders.

Samphan has more than 9,000 policyholders, while its liabilities exceed Bt400 million.

Itthaboon Onwongsa, head of the Foundation for Consumers' Consumer Protection Board, said many consumers had complained that Samphan had failed to pay claims.

The foundation urged the OIC to take legal action against the firm.

Petchanet Pratruangkrai

The Nation