Tokio Marine Life Insurance (Thailand) has raised its registered capital by Bt1.3 billion this year in support of its growing business and particularly its focus on pension choices, which look promising as Thais' life spans have continued to soar.
According to the World Bank, the average Thai life expectancy was just 67.85 years in 1985, but had increased to 74.19 by 2012.
“Everyone must retire one day,” the firm’s deputy chief executive officer, Somphot Keitkraival, told a press conference on Sunday, emphasising the need for all to plan for retirement.
He said his firm’s pension products were outstanding because they offered a guaranteed internal rate of return. He is confident that these products will be able to respond well to the needs of customers given that parent company Tokio Marine Group has solid expertise in the field.
“We are receiving good response from customers,” he said. “Many doctors have chosen our pensions.”
Because a provider of pension products must have a solid capital adequacy ratio, Tokio Marine Thailand has decided to boost its CAR.
With the significant capital increase, the firm’s CAR is expected to soar from about 269 per cent at the end of 2013 to above 500 per cent during the second quarter of this year. The Office of the Insurance Commission requires a minimum CAR of 140 per cent.
“Our capital increase will boost our financial strength even further, a key to boost customers’ confidence and to expand our business,” Somphot said.
The firm aims to achieve total premium income of Bt3.783 billion this year: Bt1.06 billion from first-year premiums and Bt2.725 billion from renewals. During the first quarter, it brought in Bt663 million in premium income – up by 12 per cent from the same quarter of 2013.
Pension choices accounted for 56 per cent of the firm’s first-year premiums during the first five months of 2014. Somphot said even though the political turmoil during the past many months had hampered its growth target somewhat, business was still growing. During the second quarter of this year, Tokio Marine Life Insurance has also bought air time for its TV commercial under the theme of “A Long Life Is a Risk”, which seeks to remind people that they need to save money for their retirement life.
Tokio Marine Life Insurance now has 14 branches in Thailand, with two more to open soon. The number of agents has also been growing, expected to rise to 3,100 by the end of this year, from 2,400 now.
“We have planned all these moves to accommodate the growing base of our customers,” Somphot said.