Representatives from the insurance industry will meet with the insurance commissioner tomorrow t... Insurance master plan unde

Representatives from the insurance industry will meet with the insurance commissioner tomorrow to discuss revisions to the insurance master plan that would better reflect private-sector views.

The revised plan, to be finalised in November before being submitted to Commerce Minister Somkid Jatusripitak, aims to improve the competitiveness and financial security of insurance companies in line with the changing business environment and future market liberalisation.

Potjanee Thanavaranit, director-general of the Insurance Department, said Dr Somkid would like to see more contributions from the insurance industry to government initiatives such as the One Million Cattle Project, as well as programmes to develop the oil palm and logistics sectors and capital markets.

With the number of Thais aged 60 years and above expected to double to 18% of the population within 20 years, the government is now looking at requiring mandatory savings by people in the middle- to upper-income brackets.

The existing system _ consisting of the Government Pension Fund, provident funds and the Social Security Fund _ is considered insufficient to guarantee financial security for retirees.

The civil service is covered by a mandatory pension system, but millions of workers in the private sector have no savings protection for old age.

One proposal is to require both employers and employees to contribute 3% of an employee's monthly salary to a retirement fund. Employers have not yet agreed, although labour union leaders support the idea.

Domestic savings would also be a primary source of capital for the country's megaproject investment plan, which requires 1.7 trillion baht over five years.

An insurance industry executive said that if the government was really sincere about improving the industry, the master plan must state clearly, as in the master plan for the financial sector, what direction local insurers should take as well as offer incentives or tax breaks to support mergers and acquisitions.

The industry also seeks a clear policy on capital requirements for insurers and solutions for small operators who still want to continue in the business.

According to Ms Potjanee, the meeting is also expected to cover the scope of investments now allowed for insurers, and the insurance protection fund as well as mechanisms to control the quality of pre-and post-sale services and the claim payment system.

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