More insurance firms face bankruptcy if COVID-19 insurance claims are not scrapped

[Sheryl]

9 hours ago, RichardColeman said:

 

 

Thailand according to their published figures has had 2.22 million cases of covid (yeah I know). Knock off say 300,00 for the last two months (say 5k a day infections) and we have about 1.92 covid cases up to November.

 

3,000 claims a day this year = 912,000 

 

Are we truly led to believe that of the 1.92 people infected with covid, approximately half had covid insurance ? 

 

I simply do not believe that number. I think it is a prime example of the Thai government either lying about the number of infections or the insurance companies being well and truly conned by repetitive con artists 

 

 

 

 

 

 

What we are seeing is a result of 2 things:

 

1. Insurance companies made completely unrealistic assumptions and projections when they designed their COVID policies - -assumptions which were completely contrary to the predictions of any public health professional. (Essentially they assumed that the very low incidence at the start of the epidemic would continue and not increase).

 

2.  Insurance companies are unable to adequately investigate claims and weed out false ones.

 

Both of these things speak to lack of competance in the field of health insurance (which is indeed extremely weak in Thailand).

 

Not all insurance companies are involved and it is a pretty good bet that none of the biggest players in the health insurance market -- companies for whom health insurance is their primary business and has been for years -- are.

 

Natural selection at work.

6 hours ago, robblok said:

I think we are talking mostly about these insurances that give out 100k for people that were just tested positive even if they had no symptoms or costs. 

 

We are not talking about normal ones where they just reimburse hospital costs. That is what i think at least that was in the news before. 

Yes, it is mostly these and some policies paid out 200K.

 

[Gsxrnz]

An Actuary requires multiple years of accurate historical data to enable them to predictably forecast the risk and associated costs of any occurrences.

 

This is Thailand.  

[IamNoone88]

After having looked at the ridiculous premiums locals get charged and their generally <deleted> poor coverage including the way they define "pre-exisitng conditions" and then link these to unrelated conditions to evade claims they can all meet a painful grisly demise. Compare this to international policies and there is a huge difference. Insurance in Thailand, from my limited experience, is archaic at best best and in other cases a rip-off at worse.

[Sheryl]

4 hours ago, Gsxrnz said:

An Actuary requires multiple years of accurate historical data to enable them to predictably forecast the risk and associated costs of any occurrences.

 

This is Thailand.  

1. Lacking that they could have used the predictions of public health experts and what had occurred elsewhere...or pretty much anything other than wishful thinking. Or just done what companies with more experience in health insurance did, and not issued policies like this at all.

 

2. Yes.

[mancub]

1 hour ago, robblok said:

Let them go bankrupt, they wanted the premiums and the other way around if someone does not claim they don't refund either.

 

However if they do go bankrupt then there will be people who won't be covered. Also car insurance and other insurances might be invalidated too. So having them go bankrupt might hit a lot of people too.

Not sure  you entirely understand the concept of insurance and it's purpose .????

[Andycoops]

Typical Thai business practice, no risk management, just rake in the premiums, what a bunch of Muppets.

Let them go to the wall for their gross incompetence.

[Enzian]

I'm curious what the moral hazard will be if the companies are allowed to disown the policies that are the source of the problem. (I have one that says it is good to March 28; it cost 680 baht.) I assume that the whole world will be told never to buy from a Thai company if this is allowed. And then what if the government finds occasions to force us to do so?

[me4175]

I only feel sorry for the people with other types of insurances which go down the drain together with the bankrupt companies. It would definitely be better to amend or scrap the lump sum COVID policies in order to protect the normal policy holders.

[Cake Monster]

5 hours ago, RichardColeman said:

 

 

Thailand according to their published figures has had 2.22 million cases of covid (yeah I know). Knock off say 300,00 for the last two months (say 5k a day infections) and we have about 1.92 covid cases up to November.

 

3,000 claims a day this year = 912,000 

 

Are we truly led to believe that of the 1.92 people infected with covid, approximately half had covid insurance ? 

 

I simply do not believe that number. I think it is a prime example of the Thai government either lying about the number of infections or the insurance companies being well and truly conned by repetitive con artists 

 

 

 

 

 

 

Of course the other scenario is that these Insurance Companies, as with many other " service sector Industries " just want to get your premium money, and that they have done very little due diligence to the consequences of a major outbreak in this case.

Nothing is quite as blind as sheer greed when its on Turbo Drive .

[John Drake]

1 hour ago, robblok said:

Yea .. i already know this that is I mention it. I doubt that these insurance companies only have covid policies. I wonder if the people cheering in this topic will be so happy if their car insurance is gone because of one of these companies going bankrupt. (just an example house insurance too). 

 

So be careful what you wish for, there are probably more insurances issued then just covid ones and they will all be gone.

So, then, the people who took out this Covid insurance should be cut off?  Just because somebody like you wants to make sure you get paid for your policies? Is the money you paid for your policies somehow more worthy than those who took out Covid insurance? Many of us on this forum have said for years that mandatory insurance policies in Thailand are scams. But the insurance enthusiasts have always sneered and talked about "sufficient cover" and other scamchatter.  Well, here it is. Insurance is a scam in this country. Now, just wait for the insurance babblers to start blubbering about all their previous payouts and how their policies are from "good companies" that would never  do something like this.  Yea, sure.

Edited December 31, 2021 by John Drake

[John Drake]

1 hour ago, robblok said:

They are talking about policies that pay out a lump sum i believe 100.000 for a positive test for covid even if no symptoms or cost are incurred.

What do you mean no costs?  People testing positive in this country are put into hospitals and quarantined, meaning real loss of income from being off work and lost salary. You just want them stiffed to protect your own interests.

[Sir Swagman]

Banks, who, like insurance companies basically rip off their customers at every opportunity, get bailed out by governments when the faecal matter hits the rotating cooling device, why should this be different?

[John Drake]

33 minutes ago, me4175 said:

I only feel sorry for the people with other types of insurances which go down the drain together with the bankrupt companies. It would definitely be better to amend or scrap the lump sum COVID policies in order to protect the normal policy holders.

Do you have those "other types of insurances" that you seem to intimate are morally superior and more deserving of payout?

[realfunster]

6 hours ago, RandiRona said:

Let them go bankrupt, otherwise thousands of people would, whose claims they are denying. But we all know how this story would end.

Poorly thought through knee-jerk response.

 

Please remind me how the company(-ies) going bankrupt helps anyone get their money or a reasonable portion thereof ?

 

 

[realfunster]

1 hour ago, IamNoone88 said:

After having looked at the ridiculous premiums locals get charged and their generally <deleted> poor coverage including the way they define "pre-exisitng conditions" and then link these to unrelated conditions to evade claims they can all meet a painful grisly demise. Compare this to international policies and there is a huge difference. Insurance in Thailand, from my limited experience, is archaic at best best and in other cases a rip-off at worse.

Agree, still very much a developing market in terms of insurance and this will only change once the local populace become more discerning, experienced and demanding.

 

A lot like many other industries & businesses in Thailand to be fair…..

[robblok]

42 minutes ago, John Drake said:

So, then, the people who took out this Covid insurance should be cut off?  Just because somebody like you wants to make sure you get paid for your policies? Is the money you paid for your policies somehow more worthy than those who took out Covid insurance? Many of us on this forum have said for years that mandatory insurance policies in Thailand are scams. But the insurance enthusiasts have always sneered and talked about "sufficient cover" and other scamchatter.  Well, here it is. Insurance is a scam in this country. Now, just wait for the insurance babblers to start blubbering about all their previous payouts and how their policies are from "good companies" that would never  do something like this.  Yea, sure.

i think you misunderstand me, I have no such risk. First of all my health insurance is with a foreign insurer, and my car insurance is with an insurer that is mainly active in the car market.

 

In my first statement i said let them go bankrupt. I am still supporting that opinion, however people should realize the results and impact this can have on others. Not me I have no exposure. 

 

What i was commenting on was all the people cheering about insurance companies going bust without thinking what kind of impact it could have on other insurances and other people.

 

So your barking up the wrong tree.

 

Them going bankrupt will leave some policy holders hung out to dry. So its not the insurance company hurting. I see no other option as them going bankrupt. But it will not only hurt the companies, but some consumers as well. So its sad news. 

Edited December 31, 2021 by robblok

[khunjeff]

37 minutes ago, John Drake said:

What do you mean no costs?  People testing positive in this country are put into hospitals and quarantined, meaning real loss of income from being off work and lost salary. You just want them stiffed to protect your own interests.

The poster was correctly describing the terms of the policies that were issued, and that are currently at issue - they pay a set amount if you test positive, regardless of whether you incur any costs. The fact that many asymptomatic people DO occur costs of some kind doesn't alter those conditions.

[Etaoin Shrdlu]

1 hour ago, robblok said:

I think we are talking mostly about these insurances that give out 100k for people that were just tested positive even if they had no symptoms or costs. 

 

We are not talking about normal ones where they just reimburse hospital costs. That is what i think at least that was in the news before. 

That's correct. 

 

It is the smaller Thai insurers that issued personal accident policies with a cash benefit upon testing positive for Covid that are in trouble. I have heard that some people took out multiple policies and then sought to get infected in order to claim. I'm not sure how true this is or whether it is just the insurance industry trying to blame their policyholders for the situation they put themselves in. In any event, these insurers really are in trouble.

 

Those lobbying the OIC for relief from their obligations to pay Covid claims are stating the they offered these policies before the magnitude of the Covid situation was known. I don't have much sympathy for them because they could have taken note of how the pandemic was playing out in other countries early on. It is also a principle of insurance that a risk must be known and quantifiable before it can be the subject of insurance. Seems they missed out on this point, too.

 

For those who rub their hands together in glee about the possibility of evil insurers going bankrupt, keep in mind that without insurance the transport system can grind to a halt and both individual and corporate borrowers can be placed in default on loans that have insurance covenants. The cost to replace the bankrupt insurers' coverage will likely be for the accounts of the policyholders and the insurers still standing will take advantage of this new demand. So, yes, the insurers created this problem themselves, but it is now potentially a much larger problem with broad impact.

 

On another note, the OIC has been generally in favor of consolidation within the insurance industry as there are more insurers than the market the size and penetration level in Thailand can support efficiently. This may be the golden opportunity to remedy this situation. Let's see how adept the OIC is and how much attention this gets from the government.

[robblok]

31 minutes ago, John Drake said:

Do you have those "other types of insurances" that you seem to intimate are morally superior and more deserving of payout?

Its a choice, we are talking here about policies that payout 100k or 200k even if no cost are made by the insured. Now weigh that against an insurance that is paid for an that will only pay out when there are costs made. 

 

So who do you think is more deserving. IMHO if they have to do something to save as many CONSUMERS (not the company). They should amend the policies that those who paid for cost cover get paid first and those who did occurred cost would get those cost plus their insurance premium. That would at least make sure that the CONSUMERS are not hurting. If that means some companies go bankrupt. No problem.

 

But just think about it you paid for an expensive insurance to cover your covid cost and all of a sudden the company goes under gone is your premium. While those who win out those who made less cost then they got payout are smiling and happy.

 

Like i said in one of my post, i have no exposure. So its not hitting me I am not writing this to save my ass. Just stating my opinion on what is fair.

[robblok]

1 minute ago, Etaoin Shrdlu said:

That's correct. 

 

It is the smaller Thai insurers that issued personal accident policies with a cash benefit upon testing positive for Covid that are in trouble. I have heard that some people took out multiple policies and then sought to get infected in order to claim. I'm not sure how true this is or whether it is just the insurance industry trying to blame their policyholders for the situation they put themselves in. In any event, these insurers really are in trouble.

 

Those lobbying the OIC for relief from their obligations to pay Covid claims are stating the they offered these policies before the magnitude of the Covid situation was known. I don't have much sympathy for them because they could have taken note of how the pandemic was playing out in other countries early on. It is also a principle of insurance that a risk must be known and quantifiable before it can be the subject of insurance. Seems they missed out on this point, too.

 

For those who rub their hands together in glee about the possibility of evil insurers going bankrupt, keep in mind that without insurance the transport system can grind to a halt and both individual and corporate borrowers can be placed in default on loans that have insurance covenants. The cost to replace the bankrupt insurers' coverage will likely be for the accounts of the policyholders and the insurers still standing will take advantage of this new demand. So, yes, the insurers created this problem themselves, but it is now potentially a much larger problem with broad impact.

 

On another note, the OIC has been generally in favor of consolidation within the insurance industry as there are more insurers than the market the size and penetration level in Thailand can support efficiently. This may be the golden opportunity to remedy this situation. Let's see how adept the OIC is and how much attention this gets from the government.

That is what i am trying to say too, but so many posters have no clue what they are talking about. 

[khunjeff]

11 minutes ago, realfunster said:

Please remind me how the company(-ies) going bankrupt helps anyone get their money or a reasonable portion thereof ?

The two options being entertained here are:

 

- Government: companies may go bankrupt, in which case some policy holders may not be paid

 

- Companies: we cancel the policies that we regret issuing, and some policy holders are not paid

 

Neither of these works out great for the insured persons who bought policies in good faith. In a well-regulated insurance system, the companies should have had reinsurance and/or emergency funds to help cover losses in case of unexpected (or, in this case, fully expected...) large payouts, but clearly that didn't work the way it should have here.

 

[sapson]

A while back they changed it from mandatory hospitalization, if you were not very sick you could isolate at home, has that policy been reversed again? 

[candide]

2 hours ago, robblok said:

I think we are talking mostly about these insurances that give out 100k for people that were just tested positive even if they had no symptoms or costs. 

 

We are not talking about normal ones where they just reimburse hospital costs. That is what i think at least that was in the news before. 

I think you are right. There have been only few cases from people arriving in Thailand with the mandatory insurance for Thailand Pass or COE, so it cannot be the main cause of loss.

 

However, which ones will be refused payment? Hmmmm...

[robblok]

6 minutes ago, khunjeff said:

The two options being entertained here are:

 

- Government: companies may go bankrupt, in which case some policy holders may not be paid

 

- Companies: we cancel the policies that we regret issuing, and some policy holders are not paid

 

Neither of these works out great for the insured persons who bought policies in good faith. In a well-regulated insurance system, the companies should have had reinsurance and/or emergency funds to help cover losses in case of unexpected (or, in this case, fully expected...) large payouts, but clearly that didn't work the way it should have here.

 

I lean more towards option 1 because othewise im sure the companies will make sure they get out of it without too much loss. Its not as if they would get the maximum out for the insured while hurting themselves. 

[John Drake]

26 minutes ago, khunjeff said:

The poster was correctly describing the terms of the policies that were issued, and that are currently at issue - they pay a set amount if you test positive, regardless of whether you incur any costs. The fact that many asymptomatic people DO occur costs of some kind doesn't alter those conditions.

If you test positive, you go into quarantine.  You lose days at work and pay. You have losses. That is what people insured against, and they deserve their payout whether the insurance salesmen on this forum like it or not.

[Etaoin Shrdlu]

5 minutes ago, khunjeff said:

The two options being entertained here are:

 

- Government: companies may go bankrupt, in which case some policy holders may not be paid

 

- Companies: we cancel the policies that we regret issuing, and some policy holders are not paid

 

Neither of these works out great for the insured persons who bought policies in good faith. In a well-regulated insurance system, the companies should have had reinsurance and/or emergency funds to help cover losses in case of unexpected (or, in this case, fully expected...) large payouts, but clearly that didn't work the way it should have here.

 

There probably isn't a solution that doesn't involve either the OIC allowing the insurers to avoid some of their potential obligations under the policies in question or a bailout of some sort, or both. Perhaps consolidation of all of the problematic personal accident policies under one government-supervised "bad insurer" with a limit of one payout per person would be a start.

 

Many Thai insurers have small capital bases and rely heavily upon reinsurance, which for this risk they do not have. I think this problem looks like a triumph of their marketing departments over their underwriters, or simply a complete failure of their underwriters to recognize and assess the risk. I think it is also a failure of the OIC in allowing insurers to provide cash payouts for positive Covid tests. 

 

[PremiumLane]

Another case that highlights the need for universal healthcare. With everyone paying into it each month though a small tax. It isn't rocket science, but I guess it doesn't benefit shareholders

[robblok]

15 minutes ago, John Drake said:

If you test positive, you go into quarantine.  You lose days at work and pay. You have losses. That is what people insured against, and they deserve their payout whether the insurance salesmen on this forum like it or not.

Of course they deserve payout, however these insurances will go bust so people will hurt. You don't really seem to get that. Consumers will be hurt. So the question is how to spread the pain best. You totally misunderstand my posts. I guess you don't want to understand.

[robblok]

11 minutes ago, PremiumLane said:

Another case that highlights the need for universal healthcare. With everyone paying into it each month though a small tax. It isn't rocket science, but I guess it doesn't benefit shareholders

I am all for universal healthcare, it works best. But insurance companies don't have a say in that. The government and the voters do. 

[John Drake]

1 minute ago, robblok said:

So the question is how to spread the pain best.

To spread the pain evenly, put the people who owned these companies and issued these policies in jail and fine them so much that when they get out, they're living in a thatch hut.