Thai finance minister closes down two insurers over unpaid COVID-19 claims

They had their licences revoked after running out of money to pay their customers.

Thailand’s Finance Minister has revoked the licences of Southeast Insurance and Thai Insurance after failing to pay over TH฿18b ($540m) in COVID-19 insurance payouts, according to the Office of Insurance Commission (OIC).

The revocation of the licence was made under the Non-Life Insurance Act. Secretary-general of the OIC Suttipol Taweechaikarn said this move was to protect the interest of both companies’ customers.

Before the revocation of their licences, the OIC ordered the two insurers to temporarily cease selling new insurance policies and had discussions with shareholders from Southeast Insurance and Thai Insurance. However, shareholders refused to inject new capital to pay for the unpaid claims and insisted on discontinuing their business. 

“As this matter threatens to affect the public interest, the OIC suggested that the finance minister make the decision to solve the problem,” Suttipol said.

Southeast Insurance still owes TH฿13.5b ($400m) in COVID-19 claims whilst Thai Insurance owes TH฿4.6b ($140m).

After the closure, the OIC and the General Insurance Fund will take responsibility for compensation payments of the customers of the two firms. Meanwhile, the OIC is set to have a meeting with 15 insurance firms on the possibility of takeover of the two insurers’ non-COVID-19 policies and possible refund of insurance premiums.

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