Tokio Marine Insurance (Thailand) expects its annual premium growth will beat the industry average for years to come, while its Japanese parent plans to use the Thai unit to expand into Southeast Asian frontier markets.
The local insurer expects its annual premiums will reach 10 billion baht by 2017 from 6.4 billion this year, president Shinkichi Miki said.
Thailand's largest marine insurer by premiums expects 13% growth in total premiums next year, higher than the 10% forecast for the overall insurance industry.
Mr Miki said the company's premiums would probably miss this year's 8-billion-baht target, reaching only 7.4 billion due to both the earlier political turmoil and the slowdown in domestic automobile sales weakening demand for insurance protection.
The Thai unit saw its premiums in the first 10 months of this year fall by 8.9% year-on-year.
In the January-October period, three of the insurer's four businesses — fire, marine and motor — reported premium declines of 25.4%, 9% and 20.5%, respectively.
Only miscellaneous insurance delivered an increase at 8.3% year-on-year.
Miscellaneous and motor insurance represent the company's largest portion at 43% and 46% of total premiums, respectively.
Mr Miki is optimistic that domestic car sales will return to normal next year and said the company would maintain its focus on motor insurance.
Domestic car sales in the first 10 months dipped 36% year-on-year to 719,260 vehicles.
Automobile sales have been lacklustre ever since effects from the Yingluck Shinawatra government's first-time car buyer scheme wore off.
The Japanese insurer plans to use the Thai unit as a base from which to expand into Myanmar, Cambodia and Laos, where it expects dynamic growth under the single market of the Asean Economic Community, which is scheduled to kick off in December next year.
"A lot of customers are interested in investing in these neighbouring markets, and cross-border transactions are increasing rapidly," Mr Miki said.
He said his company had been studying business models in line with the regulations of each of the neighbouring countries.
The Thai unit expects to spend at least five years developing its business in those markets to the point where they can contribute significant premiums.
Southeast Asia's high growth potential and rising demand for insurance protection products are luring Japanese insurance companies to make their presence felt via both organic growth and mergers and acquisitions.
These moves are aimed at offsetting Japan's ageing society.