FAQ
Part 1: Company Details
Section 1.1: Company Overview
- The first and largest life insurer in Thailand owned and established by Thai nationals based on gross written premiums (Source: The Thai Life Assurance Association)
- Leading agency network across the nation
- Multi-channel distribution strategy
- Comprehensive insurance products and innovations / new products offered regularly
- Robust profitability and shareholder value creation
- A best-in-class management team with extensive experience in Thailand’s life insurance market with the support from TLI’s strategic shareholder, Meiji Yasuda Life Insurance Company, one of the major life insurance companies in Japan.
- Flexibility in adjusting product strategy with a reasonable compensation structure
- Acting as a consultant to give advice to customers closely, especially in upcountry areas
- Building and maintaining a long-term customer relationship
- Ability to offer complex products, which provide long-term coverage with a high profit margin.
- MY is one of the major life insurance companies in Japan.
- MY has become a strategic partner with TLI since 2013.
- MY allows TLI to receive new opportunities through the establishment of relationships with Japanese companies in Thailand.
- TLI leverages MY's experience in digital transformation.
- MY is ready to support an international business expansion plan that the Company may have in Myanmar, Cambodia or the Lao People's Democratic Republic.
Section 1.2: Business Strategies
To strengthen its business and enhance its growth potential for the future, the Company plans to spend the proceeds from this fundraising for:
- Investing in digital transformation and related marketing of approximately 2,000 million baht.
- Strengthening distribution channels through partners for approximately 5,400 million baht.
- Strengthening the capital and for working capital and other purposes of approximately 5,938 million baht
However, the Company's future plan and actual expenses may differ from the above-mentioned estimates.
The Company's product offering strategy is based on our vision and mission, which is sustainability. Our strategy focuses on launching products that are less sensitive to interest rate, e.g., participating product, investment-linked product, health rider, etc. This strategy aims to achieve sustainable VONB growth amid interest rate volatility.
Profitability is more sustainable since most of the profits come from non-guaranteed section. Par Product is less sensitive to interest rate, which is suitable for selling during the time of high volatility of interest rates.
The life insurance contract is a long-term contract, which will generate profits throughout the policy term. VONB, or Value of New Business, is the profit generated from new policies sold in that year. The company is aiming to deliver a sustainable long-term profit to our shareholders; therefore, the company focus on VONB growth.
Section 1.3: Accounting Standards: TFRS17 and TFRS9
Starting January 1, 2025, two accounting standards will take effect: TFRS9, which applies to asset classification and measurement, and TFRS17, which applies to insurance contract liabilities. TFRS17 will require insurance liabilities to be valued on a market-value basis, reflecting current economic conditions, while TFRS9 enables companies to reclassify their investment assets based on their business model (e.g., holding to maturity versus trading). Together, these standards will make the balance sheet more market-value oriented, better capturing the financial position.
The shift from TFRS4 to TFRS17 was driven by the need for greater transparency, consistency, and comparability in the financial statements of insurance companies, aligning Thai standards more closely with international standards for better investor understanding.
Section 1.4: Others
The Company typically discloses VONB every quarter and EV every half year.
The Company has a dividend policy at the rate of not less than 30% of its net profit after tax in each accounting year.
The Company must obtain approval from the Office of Insurance Commission (OIC) before the dividend payment is made to shareholders.
Click the link below to learn more : https://investor.thailife.com/en/financial-info/dividend-policy-and-payout
Section 1.5: Life Insurance Glossary
A commonly used industry measure of insurance product sales of insurance companies that is calculated as 100% of annualized first year premiums plus 10% of single premiums for all new policies written during the period.
A life insurance product designed to convert premiums that customers pay into a steady stream of income mainly for retirement
Carrying value of investments we manage and includes loans and net current assets pertaining to unit-linked products
- Endowment,
- Whole life,
- Term life, and
- Annuity insurance
An occurrence that is the basis for submission and/or payment of a benefit under an insurance policy. Depending on the terms of the insurance policy, a claim may limited or excluded from coverage
A fee paid to an agent or a broker by an insurance company for services rendered in connection with the sale or maintenance of an insurance product
Rate of average annual growth or return as measured from its beginning to its ending balance calculated on a compound basis
A life insurance product that combines savings and insurance protection features. They have fixed policy terms, usually ranging from a minimum of three years up to much longer terms such as 30 years and beyond. In return for the premium paid, endowment products provide a combination of death benefits, survival benefits during the life of the contract, and maturity benefits.
The consolidated value of shareholders’ interests in the existing business of an insurance company. In other words, it is an actuarially determined estimate of the economic value of a life insurance business based on a particular set of assumptions as to future experience, excluding any economic value attributable to future new business
Premiums received in the first year of a recurring premium policy. As such, they provide an indication of the volume of new policies sold.
Gross written premiums consist of:
- 100% of renewal premiums;
- 100% of first year premiums;
- 100% of single premiums; and
- 100% of inward premiums from retrocession.
Our gross written premiums exclude the investment portion of unit-linked products.
An insurance policy or contract reflected on records that has not expired, matured or otherwise been surrendered or terminated
Investment-linked or investment-linked products
Benefits payments and insurance claims expenses divided by gross written premium
Incidence rates and period of ailment, varying by such parameters as age, gender and period since disability, used in pricing and computing liabilities for accident and health insurance
Rates of death, varying by such parameters as age, gender, and health, used in pricing and computing liabilities for life and annuity products, which contain mortality risks
Insurance products under which policyholders may receive, at the discretion of the insurer, additional benefits based on factors such as investment performance
Gross written premium as a percentage of GDP
Consideration received with respect to life insurance policies issued or reissued by an insurance company
The practice whereby a reinsurer, in consideration of a premium paid to it, agrees to indemnify another party for part or all of the liabilities assumed by the reinsured party under an insurance contract, which the reinsured party has issued
Premiums receivable in subsequent years of a multi-year insurance policy
The practice whereby we, as a party who transfers all or part of the risks that we underwrite to a reinsurer, agrees to reinsure part of the risks that such reinsurer bears for other insurance companies, in exchange for a premium. In such case, the reinsurer is a retrocedant.
Additional insurance benefits that can be attached to the underlying base policies. In return for paying additional premiums, the policyholder obtains additional insurance coverage, either increasing the coverage already existing under the base policy, or adding benefits that are not covered by the base plan
Premiums received from single premium policies, which are policies that require only a single lump sum payment from policyholders
The termination of a life insurance policy at the request of the policyholder after which the policyholder receives the cash surrender value, if any, of the contract
Term life products offer protection against mortality and morbidity risks over a certain period of time. In return for the premiums paid, the beneficiary will receive payment of the sum assured from the insurer should the insured die or suffer another insurable event during the term of the policy. Once the policy term ends, the coverage stops and there is no maturity benefit paid out.
OIC is a government agency acting in supervision and development of insurance business to be effective and to ensure people’s rights from insurance contracts. OIC also is fully aware of Good Corporate Governance and globally accepted protocol.
For more information, please click https://www.oic.or.th/th/consumer
The sum of first year premiums, renewal premiums and single premiums. Total premium revenues do not include inward premiums from retrocession.
The Thai Life Assurance Association is the center of life insurance industry and related stakeholders to cooperate for development and prosperity of life insurance business.
For more information, please click https://www.tlaa.org/
Unit-linked policies have an associated account made up of units in underlying investment funds, which are built up through the payment of premiums to the account, but reduced through the deduction of policy charges. The account values go up and down as the prices of the units move in line with the underlying assets of each investment fund chosen by the insured and, as such, the policy benefits are linked directly to the underlying investment returns. The policy benefits typically include additional insurance coverage, either paid for via deductions of units based on cost of insurance or offered as attached non-linked riders.
This product is structured in a similar manner to unit-linked, with the policy having an account value, which is built up through the payment of premiums and reduced through the deduction of policy and coverage charges. The main difference compared to unit-linked products is that the account value does not have a direct link to underlying asset performance. Instead, we credit the account with returns determined by us (crediting rate), after taking into account underlying investment performance and competitive factor
Represents an actuarially determined estimate of the value to shareholders arising from new insurance business issued in the relevant reporting period, and is calculated as the present value, measured at point of sale, of future net-of-tax profits on a local statutory basis less the corresponding cost of capital
VONB expressed as a percentage of APE in respect of new businesses in the reporting period
Whole life assurance products are similar to endowments, except that their coverage is up to age 90 or 99 and they offer a maturity benefit at the end of the policy term (in this respect, they are more like long-term endowment products). As with endowments, whole life products also offer survival benefits such as non-guaranteed dividends and bonuses.
a percentage calculated as annualized premiums received from life insurance policies under which second year premiums are paid divided by annualized first year premiums from policies issued in the previous year. The ratio is calculated based on policies remaining in force issued within the prior 13 months period.