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Baht/$ 33.40/43
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13,950
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INSURANCE
CHAROEN KITTIKANYA
After keeping a low profile for two years, MSIG Insurance, formerly Aviva, vows to stage a comeback with a commitment to grow by an average of 15% a year. The company is investing about 30 million baht in advertising to raise brand awareness as part of the growth strategy.
''We've had very high hopes placed in us by the Japanese parent firm, given that Thailand is a key production base of Japanese firms,'' said Arnop Porndhiti, president and CEO of MSIG, an affiliate of Mitsui Sumitomo Insurance (MSI).
''They have set an annual growth target for our business of at least 15% a year which is the great challenge.''
According to Mr Arnop, the company had been busy for the past two years with reorganisation after the US$450-million cash acquisition of the Asian general-insurance operations of UK-listed Aviva Plc by Mitsui in 2004. The deal also included Aviva's operation in Thailand that was 49% owned by Aviva.
On top of that, MSIG Insurance was struggling to address operating losses, primarily from motor insurance.
Mr Arnop said the company had an operating loss of 100 million baht from motor insurance in 2006 and reduced the loss to 50 million last year.
He said a loss was unlikely this year, as the company had raised premiums, mainly for city cars, by 10-15% to cover higher risks, and had become more selective in underwriting the car insurance.
Currently, motor insurance accounts for 48% of MSIG's premiums.
MSIG last year had total premiums of 2.37 billion baht, slightly down from 2.399 billion in 2006 and compared with 2.23 billion baht in 2005. Net income after tax was 137.08 million baht in 2007, a rise from 84.18 million in 2006 and compared with 152.50 million in 2005.The company this year forecast its premiums would increase to at least 2.5 billion baht, with profit estimated at 10% higher than last year.
Mr Arnop said the company was now preparing to expand more into product liability to capitalise on the new Product Liability Law that is due to take effect in February next year, and on employee benefit products.
''We have set a target over the next two year to be a leading provider in the employee benefits segment,'' he said. ''We have set up a special working group that includes experts and professionals to study underwriting and compensation structures for this segment.''
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