The Thai life insurance market is booming. In the first five months of 2014 the sector grew by an astounding 20 percent, with new premiums skyrocketing up by 29.1 percent. These remarkable figures are due to the fact that Thailand is a relatively underdeveloped market, where penetration has been historically low. But following intervention by the government, the Thai population is increasingly aware of the many positive benefits of purchasing life insurance – and keeping it for good.
Thai Life Insurance has long since been a leader in the local life insurance market, and with the industry prospering, the company has decided to relaunch its mission and philosophy. “This year, Thai Life Insurance announced a change in its vision and mission, to become a people business giving priority to the company’s stakeholders, both direct and indirect,” says Chai Chaiyawan, President of Thai life Insurance.
“To this end, the company has had to change its beliefs and values because we not only sell life insurance, but more importantly, we sell trust, care, empathy and helpfulness. Thai Life Insurance’s new position from now on will be like a close friend that is prepared to stand alongside and do everything possible to make every stage in life of our customers secure. The key is true understanding of our customers. At the same time, we must not stop pioneering, finding new life insurance solutions to meet the needs of all life situations of everyone.”
The move could not have come at a more opportune moment; as the industry grows and attracts investment; Thai Life Insurance has clearly positioned itself as a consumer favourite brand, approachable and reliable. “Thai Life Insurance’s road map going forward will be in line with its new vision to be a People Business by determining a business strategy that is not merely re-branding or re-marketing. We will give importance to management in various areas,” says the Chaiyawan.
$200
Life insurance density in Thailand
Thailand is a high-growth market for insurance. Market penetration is a low 2.6 percent, while other Asian powerhouses like Singapore and Japan boast penetration rates of four and nine percent respectively. Furthermore, the life insurance density in Thailand currently stands at around $200, a fraction of Singapore’s $2,000 and Japan’s astronomic $4,000. That means that opportunities in the sector are plenty, for companies that have clear strategies.
Life planners to life partners
“Thai Life Insurance’s new vision will focus mainly on people, giving importance to internal personnel by developing and driving personnel both at the head office and branch offices to be more than just employees of a life insurance company,” says Chaiyawan. “They must think of customer needs as well as give importance to doing good deeds. In this regard, the company has supported its personnel to continuously engage in social contributions.
“Meanwhile, sales personnel must not merely be life insurance agents. They must develop from life planners into life partners, like life companions in every situation for policyholders or people in society. They must be capable and knowledgeable persons in order to offer total life solutions. At the same time, they must be good people with integrity, ethics and conscience as well as be givers. Thai Life Insurance personnel must continue to learn and never cease to innovate to be on top of every situation and be able to add security for customers and society.”
Though small, the Thai market is fiercely traditional, with most of the business being conducted in specialised agencies. Thai Life Insurance is looking to innovate in this respect as well, and as such has invested heavily in the training and dispatching of its agent force. “Creating sustainability for our main sales channel is very important at present as customers demand better services and demand better understanding of products in order to be able to make comparisons with products and services offered by other companies,” says Chaiyawan.
“At the same time, life insurance products are becoming more sophisticated, such as investment linked products, while agents are getting older. Despite the benefit in terms of good relationships between agents and customers, we must not forget that it is harder to motivate or manage older agents to have skills in selling new products. We must make Thai Life Insurance agents to be more than just life insurance agents. They must be trustworthy, be able to take care of clients and provide better services, clearly understand products and customer needs, as well as be professional advisors.”
New and innovative life-insurance products are another key factor in the company’s development plans. “We have been busy creating value for alternative channels such as bancassurance and direct marketing. We must create a business model that can be integrated. For example, Thai Life Insurance products can be bundled with other products based on customer preference as well as making life insurance integrated into the bank’s incentive system,” says Chaiyawan. “At the same time, work processes must be able to be integrated with the banks. Life insurance companies must be able to create value added which will support customise marketing for the banks, such as producing training materials and organising CRM activities for customers from the banks.”
Staying at the top
Part of these innovations have been to ensure that Thai life Insurance can remain at the top of its game, and continue to compete successfully, as the local market heats up. The company is reviewing its product portfolio in order to come up with new products to meet their customers’ every need. “Products that do not meet our clients’ needs must be changed,” says Chaiyawan.
We cannot work independently. Everyone is like an orchestra that must synchronise and play together in unison to deliver a harmonious song
“The work will integrate insurance mathematics, underwriting, and marketing in order to innovate new insurance products that will satisfy customers. The integration process involves setting up joint working committees such as the Product Committee. At the same time, evolution of the IT system and business process requires better management. Thus, management of talent and creation of a corporate culture is essential. We cannot work independently. Everyone is like an orchestra that must synchronise and play together in unison to deliver a harmonious song. This translates into strong teamwork.”
Thai Life Insurance’s innovative new business plan is also committed to generating sustainable profits, and optimising the company’s returns. This is because Thailand has proved to be an increasingly volatile market over recent years, with political instability threatening the development of the economy, and a growing propensity for epic storms potentially causing trouble for insurers.
“[We must be] giving importance to investment and professional risk management with rationalised investment decisions, consideration from risk perspective, and emphasis on asset liability and risk management process,” says Chaiyawan. “At the same time, in managing the business, we not only focus on growth. To create sustainable profits, we cannot emphasise solely on growth; we must also focus on the company’s value paradigm. Thai Life Insurance is committed to optimise profits and return profits back to society in the form of corporate social responsibility. In creating profits, the company must maximise products and sales channels as well as put cost perspective into operation management in all areas. ”
An open market
Thai Life Insurance, though a traditional and recognisable Thai brand, is taking its expertise and know-how to launch across number of other ASEAN markets. This rapid-growth region has been increasingly targeted by insurances companies from all over the world, but because of Thai Life’s strong presence in it native Thailand, they are optimally placed to expand across the region fast. “Preparedness in terms of brand is essential,” says Chaiyawan. “Today, we have already refreshed our brand. Furthermore, we have formed a strategic partnership with Meiji Yasuda, making us ready to effectively compete.”
The goal of Thai Life Insurance is to be the life insurance company that is in the hearts of customers, both in Thailand and those in ASEAN, because in the near future, it will step into the AEC. In order to be remembered, everyone, whether policyholders or not, must remember Thai Life Insurance as a part of society, an organisation that has received recognition from society and is able to be a sustainable part of society. Chaiyawan puts it concisely: “What defines achievement of our goal to be an iconic regional brand.”
