Insurance Industry in Thailand

Q&A with Thanita Anusonadisai, FSA, CERA, insurance regulator at the Office of Insurance Commission, Thailand Thanita Anusonadisai

Photos: Nicolas Axelrod

What can you tell us about your educational background and your journey to becoming an actuary?

I obtained my master’s degree in actuarial science from the University of Wisconsin (UW) Madison in 2007. Prior to that, in 2005 I completed my bachelor’s degree in statistics at Chulalongkorn University in Thailand.

At the time, the concept of the actuarial profession was fairly new—there were only a few Thai actuarial fellows who were working in Thailand—and I had never come across the word “actuary” before. During my sophomore year, my adviser introduced the actuarial profession to her students. I was curious and interested in learning more, so I talked to her about it after class. She shared a lot of positive things about this career. She said: “Thanita, trust me. If you choose to be an actuary, although the road ahead is not going to be easy, I can assure you that you won’t regret it.”

I trusted her and started to learn more about how to become an actuary by talking to older students who were working at insurance companies. They gave me a lot of good advice on how to become a qualified actuary and even offered me an internship in an actuarial department during the summer break.

It took me about two years to become an associate actuary. However, things got tougher after I got married and had two kids, so it took me another five years to complete all of the requirements for FSA designation. I’m grateful to my husband, parents and close friends who never stopped believing in me and always supported me as I worked to succeed in my career.

What motivated you to become an insurance regulator, and what do you like most about your current position?

The story of how I became an insurance regulator starts from the day I took a scholarship from the Thai government. Every year, the government generously sends a number of talented students to study overseas. Each of them has an obligation to come back to work for the government for twice as long as they spent overseas. In my case, it took me a year and a half to finish my master’s degree in the United States. Therefore, I started working as an insurance regulator with the Department of Insurance after I returned to my homeland.

At first, I felt obligated to the government and couldn’t wait to finish my term, so I could move on to learn and earn more in the private sector. However, after six months working as an insurance analyst in the product approval division, I was assigned to work on a special project with a group of experts from the World Bank to implement the Solvency regulatory regime for the first time. I had the chance to learn about the Insurance Core Principles (ICPs), which is a set of supervisory standards for insurance regulators around the world. For the standards around capital adequacy, the so-called risk-based capital regime in particular, it is crucial for the regulator to have strong actuarial skills and knowledge to write the regulations and supervise the industry. From that moment, I realized my organization needs to have a qualified actuary. I told myself that I wanted to be the first qualified actuary in Thailand who worked as a regulator because with that qualification, I could create a better insurance industry for my nation.

I have now worked for about 13 years for the Office of Insurance Commission (OIC), and I have gotten a chance to work in several areas, including product approval, reserves reviewing, and capital and solvency standards. I embrace the opportunities to take on different roles because I want to continue to develop. In particular, I want to improve upon my people and communication skills. My current position as a senior director is a good opportunity to train myself to be better in terms of communication and motivating a team of people from different backgrounds to work together to achieve a shared goal.

Video Exclusive: Thanita Shares How the COVID-19 Pandemic Has Affected the Insurance Industry in Thailand

What are some of the challenges you have faced in your current position, and how have you overcome them?

In my current department, there are about 30 people working for me. None of them has an actuarial background. And, most important, they never imagined that I would ever rotate into the position to be their supervisor. Therefore, my first challenge was letting them know who I am. I held an ice-breaking session to talk about myself—my personality, family and working style—and allowed them to ask me questions. After that, most employees became less nervous when talking to me because I made them feel like they knew me.

The next challenge was how to change the working culture. There were problems with the back-office system—it was outdated and often under maintenance—but everyone just lived with it. Therefore, my job was to understand their pain, hear them out and help fix it. I spoke to the commissioner, and a large budget to acquire a new enterprise resource planning (ERP) system was approved for my department.

What are some of the challenges faced by the Thailand insurance industry, and how is the regulator helping?

There are a number of challenges faced by Thai insurers, and the impact of each varies. Here is a short list of challenges the majority of players in the Thailand insurance industry are dealing with today:

  1. The COVID-19 pandemic has forced insurers to rethink and be more proactive about how they run their businesses. The pandemic exposed new and greater risks, resulting in more challenging risk assessment processes. In 2020 when the outbreak started in Thailand, some insurers were optimistic and sold insurance products that provided coverage for COVID-19 infection. This special product was simple: The insured were to be paid the lump sum amount (generally from $1,500–$3,000), and the premium was fairly cheap (less than $6). The product became a bestseller in the market. The loss ratio was about 10 percent on average, which generated beautiful profits for insurers in the first year. Unfortunately, since the beginning of 2021, Thailand has been hit by the third wave of the outbreak, and the situation went from bad to worse. The number of daily new infection cases rose rapidly from 100 cases to almost 20,000 cases. This incident has prompted awareness of effective risk management among Thai insurers, especially when approaching an emerging risk like COVID-19. The companies should perform constant risk monitoring, active repricing supported by a strategic reinsurance program, as well as have versatile IT infrastructure and knowledge to understand the risk nature and manage them appropriately.

    In light of the situation, OIC is trying to find the right balance between protecting policyholders and supporting insurers, so we can get through this tough time together. One of the key initiatives we did in response to the pandemic (during the city lockdown) was the implementation of digital meetings instead of meeting face to face. This enhances the flexibility for policyholders to access insurance products, while the agents and broker can maintain social distancing with the clients at the point of sale.

  2. Competition in the Thai insurance industry is becoming fiercer, and profits are becoming more difficult to make. The challenges resulting from the economic downturn, low interest rates and political uncertainty have pushed insurers into adopting more aggressive investment strategies in search of better yields. In this regard, OIC has amended regulations to allow insurers to pursue more investment alternatives, such as offshore investments, fund management, investment in health care and so on. Moreover, in the past few years, we have seen more mergers and acquisitions (M&A) deals in the Thai life insurance sector. Life insurers are attempting to expand their businesses by boosting sales and being more innovative in terms of products to meet customer demands. In recent years, insurers are focused on health insurance products and investment/protection insurance products, and they are reducing sales of saving insurance products with guaranteed returns due to low interest rates. In addition, several life insurers are expanding their businesses to other Southeast Asian countries, such as Myanmar, Indonesia and the Philippines.
  3. Like other countries, Thai insurers are facing challenges related to the implementation of International Financial Reporting Standard (IFRS) 17. The Thai Federal Accounting Bureau (FAB) has marked the effective date of Jan. 1, 2023. However, the industry is not ready—more time is needed to prepare in terms of data, information technology (IT) systems, working process, actuarial assumptions as well as sound interpretation of many areas of the standard. Hence, the Thai Life Insurance Association (TLIA) and Thai General Insurance Association (TGIA) are proposing that FAB postpone the implementation for another three years.
  4. The effective date of the Personal Data Protection Act (PDPA) has been postponed until 2022, allowing insurers time to comply with the many obligations introduced by the legislation.

What is the experience of InsurTech/digital insurance companies in Thailand, and what regulatory initiatives are underway to encourage digitization?

The Thai insurance industry has embraced the InsurTech concept for quite some time. Undeniably, the COVID-19 pandemic became an accelerator for using technology to support product offerings and services to customers. Online services are fully utilized throughout the insurance process, including videoconferences, virtual signature, email, e-applications for policy offering, confirmation, delivery of documents, premium payment, receiving protection and even compensation payment. I also have seen the use of artificial intelligence (AI) technology and robotics in the value chain, such as for product development, premium rates calculation for a specific group of customers in the pool, big data or so-called risk-based pricing and services, online application consideration, claims management, and pre- and post-sales services. These will help insurers improve the accuracy, speed and quality of their services and boost the efficiency of risk management and operational costs.

Likewise, the OIC recognizes the importance of supporting the digitization of the insurance sector, so the sector can promptly respond to consumer needs. Therefore, there are a number of regulatory initiatives underway to support the growth of InsurTech in Thailand. The key initiatives include the insurance regulatory sandbox, which is a regime that was introduced in May 2017. In 2020, the OIC made changes to the criteria for the sandbox to attract talented technology firms to help innovate within the insurance industry. The new sandbox is designed to be friendlier for applicants and better suit the ecosystem:

  • FinTech firms are no longer required to partner with insurance companies to participate in the sandbox.
  • The one-year implementation period is eliminated. Instead, OIC determines the implementation period based on the needs of each project.
  • Applicants are now allowed to create their own sandbox without close monitoring from the OIC. However, they need to make sure all transactions have been tested appropriately and must not have a negative effect on customers or the insurance industry as a whole.

The OIC’s 2021–2025 plan to digitize the Thai insurance sector is to be achieved through enhancing the insurance ecosystem and relaxing certain regulations to facilitate business competition and expansion. There is the potential for two kinds of digital insurance licenses: one for new entrants merely selling insurance on a digital platform and one for existing insurers that want to switch to a digital channel only. However, the initiative is still being studied and may take time to implement.

To allow insurers to fulfill their roles in the digital age, it is crucial that the government relax regulations to support and strengthen risk management and consumer protections. However, insurers must not forget about their role as trustworthy advisers for their customers. Insurers must put effort into creating new levels of consumer protection where there is a balance between innovation and possible risks.

How do you achieve a work/life balance?

Since becoming an FSA in 2019, I have had more leisure time. However, I had my third child in August 2021, so work/life balance is a little more challenging today!

I believe every successful actuary is well-trained to achieve a work/life balance, and my secret is simple: Working is part of my life, but once I come home, work is set aside. I love to spend quality time with my family—I often play board games with my daughters, who are 7 and 4, and watch Netflix with my husband. I find that laughter, love and smiles among family members are the fastest way to recharge my internal battery. I also enjoy baking. Everyone in my family loves to eat my homemade bread, and sometimes I make a bit extra to share with neighbors.

Thanita has enjoyed baking homemade bread during the COVID-19 pandemic.

How significant is teamwork, and what work ethics do you instill in your team?

Team spirit is one of the key success factors in career development. Statistically, it has been proven that organizations that operate in a silo system are less effective and innovative. As such, teamwork is significant.

Three key aspects of a good work ethic that I try to instill in my team are:

  1. Be productive. This can be done by encouraging employees to prioritize their work and by setting clear expectations and more challenging key performance indicators (KPIs) each year. I know that no one is perfect, and being productive doesn’t mean they have to produce excellent work all the time. Therefore, to promote productivity, I adopt the carrot and stick concept. We celebrate the small achievements with my team. However, if there are errors detected, no matter how small, fast actions must be taken to rectify the problems and a plan put in place to prevent the same mistakes in the future.
  2. Always find a way to improve yourself. Staff should seek out professional development or ways to improve their skills. They must not stop learning new skills, especially since we are in an era where new knowledge is at our fingertips.
  3. Show respect to others. One must speak politely to others in the workplace and keep interactions professional. This helps promote a good relationship among the team members.

How important are soft skills for actuaries?

Soft skills like communication are as important as technical skills. In my case, being the first qualified actuary in my organization, there was the stereotype among those who had never worked closely with me that I might be studious and an introvert. Fortunately, I had a lot of chances to participate in projects, meetings and conferences, which helped me improve my communication skills over time. To earn the senior directorship, I had to prove myself several times and show that I am not only good at actuarial matters, but I also can effectively convey in-depth knowledge to others.

Apart from that, my advice to actuaries who want to be successful in their careers is that they must not stop developing the human skills. This means the ability to collaborate and work well with others on a team.

What initiatives would you suggest to increase awareness of the actuarial profession in Thailand?

In the past 10 years, awareness of the actuarial profession in Thailand has increased significantly—not only within the insurance industry, but also among the wider public. But we need to do a better job of informing new generations about this profession.

The actuarial profession in Thailand assesses enterprise risk management, solvency surveillance, product pricing and liability valuation. The upcoming implementation of IFRS 17 will require additional work from actuaries both in designing and assessing insurance business models along with related infrastructure. While the demand for more actuaries in Thailand is clear, the supply is low. According to the Society of Actuaries Thailand (SOAT), there are about 280 members but only about 80 actuaries who are qualified.

All stakeholders in the industry—including the SOAT, the regulator and the two insurance associations—must work together to promote the actuarial profession by coordinating with universities. Social media and other digital platforms can also be used to reach students. These powerful tools can draw public attention and create awareness about the actuarial profession in Thailand.

Any general words of advice for aspiring actuaries?

I know it is not easy to find the right balance between work and life. Persevere while studying because there is a long road for everyone to enjoy life after you finish the exams. Trust in yourself and never give up! As you can see, every cloud has a silver lining.

Thanita Anusonadisai, FSA, CERA, is the insurance regulator at the Office of Insurance Commission, Thailand.

Statements of fact and opinions expressed herein are those of the individual authors and are not necessarily those of the Society of Actuaries or the respective authors’ employers.

Copyright © 2021 by the Society of Actuaries, Chicago, Illinois.