The Thailand general insurance industry is forecast to grow at a compound annual growth rate (CAGR) of 4.5% over 2024–28, from THB310.9 billion ($9 billion) in 2024 to THB370.8 billion ($10.9 billion) in 2028, in terms of gross written premiums (GWP), according to GlobalData, a leading data and analytics company.
GlobalData’s Insurance Database reveals that the Thailand general insurance industry is expected to grow by 4.1% in 2024, driven by property, motor, and personal accident and health (PA&H) insurance lines, which are expected to collectively account for nearly 90% of the total general insurance premiums in 2024.
Manogna Vangari, Insurance Analyst at GlobalData, comments: “The general insurance industry in Thailand continued its growth trend and grew by 4.5% in 2023, driven by higher demand for property insurance policies led by growth in construction activity, increased health awareness, and robust regulatory reforms. The trend is expected to continue in 2024.”
Motor insurance is the leading line of business in the Thailand general insurance industry, estimated to account for a 53.8% share of the general insurance GWP in 2024. It is expected to record a slower growth of 3% in 2024 as compared to 3.9% growth in 2023, owing to a decline in domestic car sales due to slower economic growth. As per the Federation of Thai Industries (FTI), car sales in January-April 2024 declined by 23.9% as compared to the same period in the previous year.
However, in 2024, the growth will be supported by an increase in the sales of electric vehicles (EVs). According to FTI, in March 2024, newly registered hybrid electric vehicles witnessed an increase of 35.7% as compared to March 2023.
Positive regulatory developments related to EV insurance will also support motor insurance growth. In April 2024, the Office of the Insurance Commission (OIC) established vehicle codes and insurance premium rates for EVs under the Motor Vehicle Accident Victims Protection Act B.E. 2535.
The regulation aims to standardize the system for determining vehicle codes and insurance premium rates for EVs, simplifying data collection and storage. The insurance companies are required to adopt these new codes and rates for contracts starting from June 1, 2024.
Thailand witnessed increasing cases of road accidents in 2023. According to the Road Accident Information Center (ThaiRSC), traffic accident cases increased by 2.6% during January – April 2024, as compared to the same period in 2023. Higher claims for road accidents will prompt insurers to reassess their risk exposure and increase premium rates in 2024, which will support motor insurance growth. Motor insurance is expected to grow at a CAGR of 3.7% during 2024-28.
Property insurance is the second largest line, estimated to account for an 18.8% share of the general insurance GWP in 2024. Property insurance is expected to grow by 9.4% in 2024, supported by the government’s focus on the development of tourism infrastructure, energy generation, and housing projects.
Vangari adds: “The construction industry in Thailand is expected to expand by 3.5% in 2024 and record an average annual growth rate of 4.2% from 2025 to 2028. Its growth in 2024 will be supported by an improvement in residential demand, highlighted by the increase in the value of outstanding mortgage loans and the number of residential land development licenses issued, which will support property insurance growth. However, in the short term, geopolitical tensions and elevated costs for materials and energy will pose a downside risk to property insurance claims.”
In March 2024, the OIC issued amendments to fire insurance premium rates and discounts for fire extinguishing equipment applicable to fire insurance policies. The objective of these amendments is to align premium calculations and discounts with contemporary risk assessments and safety measures that ensure premium rates and discounts are fair and consistent. Property insurance is expected to grow at a CAGR of 7.5% over 2024–28.
Personal Accident and Health (PA&H) insurance is the third largest line, estimated to account for a 17.3% share of general insurance GWP in 2024. PA&H insurance is expected to grow by 3% in 2024, driven by increasing health awareness and rising costs of medical treatment, leading to higher demand for health insurance policies. PA&H insurance is expected to grow at a CAGR of 4.2% during 2024-28.
Liability, Financial Lines, Miscellaneous, and Marine, Aviation, and Transit (MAT) insurance are expected to account for the remaining 10.1% share of the general insurance GWP in 2024.
Vangari concludes: “Initiatives from the government and favorable regulatory reforms will help in increasing the general insurance penetration rate in Thailand (1.59%), which was lower as compared to other regional markets such as Australia (3.52%), New Zealand (2.23%), Japan (1.75%), and Hong Kong (1.65%) in 2023. Persistently high claim payouts led by inflation and rising cases of road accidents will prompt insurers to reassess their risk exposure and increase premium rates in the short term.”
