Thailand’s Office of the Insurance Commission has published the proposed requirements as part of the draft document.
It has been given the, not unsubstantial, title of ‘Notifications re: Rules and Procedures for Issuing and Offering for Sale Insurance Products of Life and Non-Life Insurance Companies and the Operations of Insurance Agents and Licensed Brokers’.
The key element for insurers and advisers concerns the disclosure of fees and commissions.
According to the draft document; an insurance company in Thailand must have a business plan outlining the fees and commissions that it would pay to agents, licensed brokers, and banks which sell their insurance products, for all sales channels, as well as setting incentive fees, key performance indices, and punitive measures.
Fair treatment
In addition, the document introduces concepts of good corporate governance stemming from the board and spreading into company culture and the promotion fair treatment of customers.
The draft will also impose certain processes on insurers’ business operations, such as risk management and internal control.
The notifications also recognise the concept of banks conducting telesales business. Telesales people have to obtain permission to record sales conversations or terminate the call if permission is not granted.
Firms found to be in breach of the rules, which are expected to come into effect in January 2019, could have parts of their businesses suspended or have their licence revoked in the severest cases.
