Develop into a central organization with excellence
“The goal of the Life Insurance Association is to have continuous growth in the life insurance business, create standards for life insurance companies to achieve excellence, people have knowledge and understanding of life insurance, improve the quality of agents to become professional, and develop the association to become a central organization with excellence.”
In the modern world, there are rapid changes, which are both opportunities and challenges for businesses, especially the life insurance business, which must adapt to current events, including the role of the Thai Life Assurance Association, which acts as a central coordinator between member companies to jointly cope with changes so that businesses can continue to operate.
bank finance Had a special interview Nusara (Assakul) Banyatpiyaphon, President of the Thai Life Assurance Association Who took over the baton to support the life insurance business to grow sustainably under the changes in the current world.
Continue the policy of creating growth
Nusara said that the roles and policies of the Thai Life Assurance Association consist of promoting sustainable growth in the life insurance business sector, which currently has many dimensions, such as investment in environmentally friendly projects, sustainability in terms of policy renewal, stability of the fund, strong financial position, and development of products that support sustainability, including creating readiness to operate in accordance with international standards.
This includes supporting the business sector to use technology and innovation to drive the organization, developing service models that effectively meet customer needs, and building better sustainable relationships with customers amidst rapid changes.
Nusara said another important issue is providing knowledge and education about life insurance. According to data from 2566, there was an Insurance Penetration of 3.55% and an Insurance Density of only 9,580.86 baht, showing that the life insurance business still has a lot of room for growth in the market.
However, to make Thai people interested in life insurance, we must start by providing knowledge to all groups of people, starting from basic knowledge of life insurance, types of life insurance policies, benefits and exceptions according to the policy, tax benefits, etc., so that people see the necessity of life insurance as a tool for financial planning and risk management for the family. At the same time, we must provide knowledge on how to prevent fraud in various forms related to life insurance.
key to success
Nusara said that the life insurance business is a business that sells credibility and trust, which is a key to success in building sustainable relationships and increasing business growth opportunities. However, it is also a weakness of the business. Therefore, the life insurance business places great importance on this issue, starting from the quality of service that must be as the company claims, and the product information must be complete and correct.
In addition, there must be transparency in disclosing terms and conditions, including policies such as refunds, policy cancellations, and exceptions to prevent misunderstandings that may lead to dissatisfaction or distrust from customers. Businesses must strictly comply with laws and standards to ensure that the company does not conduct unethical business and also builds the company's credibility and professionalism.
At the same time, various regulations must be monitored to be current by requesting a review and amendment of laws, including relaxing regulatory rules in various areas such as product regulation, investment by life insurance companies, providing fair services to customers under the principles of good governance, so that businesses can operate in accordance with market practices, have flexibility in operations that can quickly accommodate various situations, and help increase the competitiveness of member companies.
In addition, the association's operational efficiency must also be increased, both in terms of providing knowledge, the ability to coordinate and track issues quickly, adapt to changing environments or needs, and be an organization that disseminates useful and reliable information.
“The ability of the industry to adapt quickly, the ability of the association to point out to its members the problems that some companies are starting to face and be cautious, I think that’s very important, and then we talked about sharing more data together.”
Adapting to consumer needs
Nusara said that currently, business models need to change and develop from the past in order to adapt to customer needs, such as adapting to digital technology with maximum efficiency. Businesses must have knowledge and understanding and increase the use of modern technologies such as artificial intelligence (AI), automation, advanced data analysis to help with decision-making and increase work efficiency, both in terms of deeply analyzing customer behavior and needs, and predicting various risks to design products that meet the needs of customer groups.
Pricing must be appropriate for the risk and able to provide personalized services by offering products that are customized based on personal information such as health history and lifestyle behaviors, including cybersecurity. As businesses face an increased risk of cyberattacks, they must invest in information security systems to protect customer data and internal company systems in order to build customer confidence.
In addition, businesses must quickly adapt to changes. Their working style must be flexible and integrated. If problems occur, they must be able to be ordered to be solved from various locations. They must always be prepared with appropriate technology and management systems for new working conditions. They must focus on taking care of customers holistically, such as comprehensive financial planning services, retirement planning, investment, and financial risk management, as well as health monitoring services and risk management, such as health check-ups and support for behavioral changes to reduce the risk of various diseases.
At the same time, businesses must be able to continuously innovate, both in terms of products and services, to keep up with the ever-changing and increasingly intense demands. Businesses must be able to combine a variety of services to better meet individual needs.
This includes offering integrated services to customers who expect comprehensive and seamless services. Data will play a key role in decision-making. Businesses that can use data to analyze data in depth to predict market needs and effectively adapt to data will have a long-term advantage over other businesses.
Nusara said the association is trying to make businesses manage their business with more consideration for sustainability and ESG responsibility by investing in securities of businesses that focus on sustainability, such as investing in sustainable investment funds (SRI funds), of which Thailand currently has 13 funds under the management of 3 asset management companies (asset management companies): UOB Asset Management (Thailand) 4 funds, TISCO Asset Management 4 funds, and Kasikorn Asset Management 5 funds.
Including participation in supporting society and communities, such as donating part of insurance premiums to charity, supporting education and community development to improve Thai society, creating awareness in the organization to see the value of energy and natural resources through campaigning for employees in the organization to see the importance of using resources for maximum benefit and not destroying the environment, such as reducing paper use, reducing water and electricity use, supporting travel by public transportation, etc.
In addition, increase transparency and credibility of the business by disclosing information, providing clear and transparent information on life insurance conditions and claims, using technology to check and manage claims, and verifying the accuracy of information.
“The life insurance industry must help develop central standards, with the association acting as the core to drive digitalization in various areas, including receiving complaints from member companies about weaknesses in their businesses that need to be addressed, in order to connect regulatory agencies and other agencies to find ways to develop or resolve issues together.”
Factors supporting business growth
Nusara said that currently, the life insurance business still has a tendency to grow continuously. This is a result of the COVID-19 crisis and the increasing cost of medical treatment every year. This has caused people to realize and see the need to take care of their own health. They have turned to buy life insurance and health insurance more clearly. At the same time, the advancement of technology also gives businesses the tools to develop products and services that can meet customer needs more precisely. It also helps facilitate customers in the modern world whose behavior and lifestyle have changed from the original focus on convenience, speed, and ease.
In addition, there are supporting policies from regulatory agencies, whether it is the issuance of various measures to relax supervision, which allows the business sector to operate more conveniently, quickly, with greater flexibility and agility, and to compete in both domestic and international markets. There are also tax incentives that allow policyholders to deduct life insurance premiums from personal income tax up to 100,000 baht, health insurance premiums up to 25,000 baht, and pension insurance up to 200,000 baht.
Including the fact that Thailand has completely entered the aging society, it is expected that in the year 2603 there will be a population aged 60 to over 90 years in the proportion of 39% and a dependency rate of 1 elderly person to 1 working-age person, resulting in life insurance products becoming more popular among the working-age group, especially life insurance, savings insurance and pension insurance.
Moving forward to cope with an aging society
Nusara said that the advancement of Thai society into an aging society is another challenge and opportunity for the life insurance business, which must adapt to cope with the changes that occur, whether it is the development of new life insurance products and services for the elderly, the increased risk of claiming compensation, the impact on the finances of life insurance companies, and the company's risk management.
Life insurance companies have developed life insurance products that support retirement, income and health coverage, as well as life insurance products related to inheritance management services and providing benefits to families in the event of death. This is both a challenge and an opportunity for businesses to develop new products that are suitable for the elderly group in the long term, such as insurance policies that focus on long-term coverage, providing long-term benefits after retirement, and considering health risk management and providing services that meet the specific needs of the elderly.
At the same time, as the age increases, the health risks of policyholders also increase. As the elderly population increases, the costs that insurance companies have to bear in paying compensation or health benefits will increase, which will result in businesses having to assess risks accurately and strictly consider insuring for the elderly group. In addition, providing long-term health insurance must take into account the management of increased costs for medical treatment and long-term care more than other customer groups.
In addition, longer-than-expected life expectancy, without adequate risk management, may affect the financial status of life insurance companies in the future, as the company has to pay more compensation or medical expenses. As a result, life insurance companies have to adjust their strategies and increase the efficiency of risk management, such as using more accurate forecasting data or developing life insurance innovations to support the needs of the elderly in the future.
“The life insurance industry must help develop common standards, with the association acting as the core to drive digitalization in various areas, including receiving complaints from member companies about weaknesses in their businesses that need to be addressed, in order to connect regulatory agencies and other agencies to find ways to develop or resolve issues together.”
Creating products for the modern world
Nusara said that in developing life insurance products today, the life insurance business must adapt to customer needs. The product format must be flexible and can be changed at any time according to the needs and behaviors of each individual customer at each time, such as adjusting coverage, benefits, insured amounts, and coverage periods. The premium can be adjusted according to actual usage, such as the Pay-As-You-GO model, adjusting premiums according to improved lifestyles or reduced travel, which will make customers feel that the premium reflects their lifestyle more.
Including the option to pay premiums monthly or yearly according to suitability or purchasing power of the insured, development of distribution channels and providing complete convenience to customers, such as selling life insurance via electronic channels, claim hotline, online premium payment, and health care services, etc.
In addition, AI and Machine Learning are being used to help assess risks more accurately by using Big Data to process to create group-specific or individual coverage, such as using each person's health and behavior data to assess risks and calculate premiums to help make the underwriting process and claim management more efficient. Customers can access information and manage their own policies from the beginning to the end of the process via online platforms or mobile applications that can be connected.
Including other services such as using general information via Chatbot, customer identity verification with e-KYC system and AI Knowledge management, data management and search within the organization, etc. In addition, the use of Blockchain helps increase efficiency, security and transparency in data management and transactions, such as storing and verifying compensation claim information to help build credibility for the business.
Nusara said that the development of insurance models does not only focus on coverage in the event of an unexpected event, but also includes health promotion and long-term prevention, such as using benefits for exercise, annual health check-ups, or discounts for customers' good lifestyle behaviors, as well as developing insurance products that are linked to the environment and sustainability, taking into account the selection of appropriate resources in each work process that will not disturb or destroy the environment, and providing premium discounts for customers who support the use of clean energy or do activities that help reduce the impact on the environment.
“The goal of the Life Insurance Association is to have continuous growth in the life insurance business, create standards for life insurance companies to achieve excellence, people have knowledge and understanding of life insurance, improve the quality of agents to become professional, and develop the association to become a central organization with excellence.”
Follow and read other columns. Available in the October 2567 issue of Finance and Banking Journal. Issue 510 In digital format: https://goo.gl/U6OnIi
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