• 
• 

Published on October 6, 2007

Chantra Purnariksha, secretary-general of the Insurance Commission, said yesterday that her office had received a report that Samphan would with high probability conclude a deal with a new Thai investor, who is involved in financial and farm businesses in Kanchanaburi.

Samphan has to find a new investor before the deadline on Monday imposed by the commission. The new partner should inject fresh capital into the company to solve its financial troubles.

Chantra said her office expected the firm to send information on its new management structure in time.

Samphan has failed to maintain its insurance fund as required by law and failed to pay claims since June.

It has been ordered to suspend the writing of new policies until it can solve its financial problems and pay off claims totalling Bt300 million to 5,500 customers.

It has to raise hundreds of millions of baht to bring its insurance fund up to the required level.

In the last two months, it could pay only Bt10 million to settle claims of 600-700 policyholders.

The new investor will have to take over the company and restart all operations as soon as possible.

Qatari companies had shown interest in taking over the firm, but negotiations broke down.

Meanwhile, Chantra expressed confidence that proposed amendments to the Life Insurance Act and Non-life Insurance Act could be enacted by December.

The bills will be submitted to the National Legislative Assembly on Wednesday.

They would tighten regulations over 24 life and 75 non-life insurers as well as protect consumers.

All insurance firms would need to increase their capital in their insurance fund, depending on size and type of business.

Presently, non-life insurers have to maintain an insurance fund at 10 per cent of their total premiums, or no less than Bt30 million. Life insurers have to keep an insurance fund at 2 per cent of their insurance reserve, or no less than Bt50 million.

The new amendments would also require all firms to maintain 100-per-cent reserve capital as assets that are free from any financial commitment.

In order to increase understanding of insurance among the public, the Insurance Commission is holding the Insurance Fair and Low Costs Products Selling Fair at the Exhibition Hall of the Department of Export Promotion in Ratchadaphisek Road, Bangkok, until October 14.

Petchanet Pratruangkrai

 The Nation