BANGKOK -- Insurance companies in Thailand are rushing to provide affordable insurance policies to match rising demand, as people scramble to buy insurance policies to secure medical expenses and compensation as the deadly new coronavirus continues to spread in the Southeast Asian country.
"From January until now, 20 insurance companies submitted their coronavirus insurance policies to us for approval before they can sell them," said a senior official at the Office of Insurance Commission, which oversees the country's insurance industry. "We expect more companies to design diversified policies as demand is rising."
Masuthi Tangpakawatkun is one of the millions of Thais who have rushed buy a coronavirus insurance policy. "I bought the insurance immediately as I fear the virus, particularly at a time when the government cannot bring it under control. I need to secure myself and my family," the 42-year-old office worker told the Nikkei Asian Review.
The country's army of motorbike taxi and food delivery drivers are some of those seeking more security with a coronavirus insurance policy, at a time when the escalating outbreak has encouraged Thais to stay at home and has driven demand for food deliveries.
Pinya Nittayakasetwat, co-founder and chief executive of GET, a leading ride-hailer and delivery service provider backed by Indonesia's Gojek, said all 20,000 of its drivers have been secured with one-year coronavirus insurance coverage in order to mitigate the risk among drivers.
The insurance industry believes that there is room for market expansion. An analyst at Kasikorn Research Center said that insurers can more easily "promote the benefit of having insurance" during the outbreak, while rising consumer awareness at such a time makes them more receptive to promotions by companies in the sector.
Thailand's insurance penetration rate in 2018, measured by the ratio of direct premium to gross domestic product, was 5.26%, according to a Thai General Insurance Association report in November last year. That is relatively high in Southeast Asia, but still low compared to countries like Singapore and Japan.
As of Tuesday, Thailand confirmed a total of 827 cases of COVID-19, with four deaths. The government, led by Prime Minister Prayuth Chan-ocha, declared that a state of emergency effective from Thursday would bring in stricter measures to control the coronavirus outbreak.
Most of the virus-related insurance offered since the start of the outbreak in January has been designed as nonlife insurance, lasting about one year and costing 500 baht ($15), which is quite affordable for many Thai consumers, according to the official at the OIC.
Since those are issued as short-term nonlife policies, it is quite easy for companies to design products that match consumer demand at affordable prices, unlike ordinary life insurance policies that need to be strictly overseen by OIC. Thais can thus buy more flexible policies with no health screening.
Insurance companies are offering to pay in the range of 500,000 baht ($15,200) to 2 million baht in compensation and medical expenses if clients develop COVID-19.
Bangkok-listed nonlife insurer Dhipaya Insurance, in which the Thai government holds a significant stake, claims it has gained 300 million baht from around 500,000 policies sold between January and March.
Somporn Suebthawilkul, managing director of Dhipaya Insurance, said the company expected to gather more customers as the company has expanded its marketing channels via several banks to reach a wider customer base. "Since the number of new coronavirus patients is rising, we expected more customers to buy more policies in order to secure their lives," Somporn was quoted as saying in local newspaper Prachachat Turakij.
Muangthai Insurance also said it had received a very good response from Thai consumers after it launched the first coronavirus insurance policy in February, following high demand.
"The number of people calling in reached a peak. We had to set up a special department to deal with rising demand from clients," said an official at Muangthai Insurance.