GENERALI GROUP is focusing on fortifying its foothold in Asia, especially Thailand, which is its second-fastest-growing insurance market in the region.
Thailand is well placed to serve corporate and commercial lines with infrastructure projects at home and neighbouring countries.
Generali, the largest insurance company in Italy, is ready to provide huge capital to Generali Insurance (Thailand) to support underwriting corporate and commercial policies as part of its aim to boost the Thai unit into the top 10 in three years, said Korakrit Khumruangrit, chief executive officer of Generali Insurance (Thailand).
“To achieve the goal in three years, we have to have premium income of Bt4 billion to Bt5 billion, or tenfold growth from Bt535 million in 2015,” he said.
This year, the company targets premium income of Bt800 million.
In Thailand, Generali has both non-life and life insurance companies.
The non-life business is cared for by Generali Insurance (Thailand), ranking 45th out of the 62 insurers in the country.
The group’s vision is to be in the top five of all markets where it has a footprint in three to five years. And Asia should represent 10 per cent of the group’s revenue.
It hopes Thailand will become the fasted-growing market in Asia next year, passing Indonesia, which is the fastest for the group currently.
The group believes the Asean Economic Community opens up a golden opportunity for insurance companies that can underwrite commercial policies, and Generali Insurance specialises in this area.
Myanmar is allowing foreign insurance companies to offer commercial insurance directly in the Thilawa Special Economic Zone.
Generali Insurance (Thailand) is drawing up business models for penetrating Cambodia, Laos and Myanmar.
Thailand and Laos will become logistic centres in Asean because Thailand is planning to construct a high-speed rail line connecting with the railway from Laos, which recently agreed with China to construct a railroad linking Vientiane with the Chinese border.
Generali Group has supported both the organic and inorganic growth of Generali Insurance (Thailand).
For organic growth, the company will have to make its brand strong in the country and leverage what the group gives to speed premium-income growth from three product categories – corporate and commercial, accident and health, and motor.
“The rate of auto sales in Thailand might not offer a positive outlook for motor insurance but we will try to promote our brand to traditional brokers,” Korakrit said.
Motor policies in the medium term will contribute 15 per cent of premium income, down from 25 per cent currently, because accident and health insurance in Thailand is growing faster.
The motor-insurance business also requires more caution because it might not make a profit without preparation.
In the first two months of this year, Generali Insurance (Thailand) enjoyed 80-per-cent growth in accident and health insurance premiums from the same period last year, while motor-insurance income soared by 60 per cent.
Even though accident and health insurance has bright prospects, the company will maintain a balance. Half of its premium income will come from corporate and commercial lines and half from accident and health lines and motor lines.
The company has formed an inorganic team to help accelerate growth. The team will not only seek opportunities for consolidation but also ways to help drive premium income.