Axa Thailand General Insurance, a unit of the French multinational, is exploring merger and acquisition opportunities to help grow its presence in the highly fragmented non-life insurance industry here, says chief executive Claude Seigne.
The company projects a 10% increase in overall premiums this year by taking a "cautiously optimistic" view, taking into account market trends, economic indicators, and its strategic initiatives designed to capture new opportunities and better serve customers, said Mr Seigne.
He said product portfolio diversification at Axa GI would help to achieve the growth target this year.
"Motor insurance remains a key product because of its widespread necessity, but we also see substantial growth opportunities in health, commercial lines and personalised insurance products," Mr Seigne told the Bangkok Post.
The company has a market share of 2.2% in the fragmented Thai non-life insurance market that has more than 50 competitors, he said.
"We are rapidly expanding our presence organically, driven by our commitment to product innovation, customer service and strategic partnerships," said Mr Seigne.
"In addition, we are open to exploring merger and acquisition opportunities that align with our strategic goals and enhance our market position."
As for the insurance industry, he projects moderate growth this year, mirroring Thailand's GDP growth.
Factors such as increased awareness of insurance products, the digitalisation of insurance offerings, and economic recovery efforts could contribute to this growth, said Mr Seigne.
Negative factors include economic fluctuations, interest rate adjustments and tighter credit conditions, which can make it more difficult for individuals to obtain bank loans, particularly affecting car sales, he said.
"Interest rate cuts have a nuanced effect. The cuts may reduce investment income for insurers, but also make financing for purchases and investments more accessible to consumers and businesses," said Mr Seigne.
"I believe the impact of interest rate cuts could surpass other economic fluctuations and lead to increased demand for insurance products."
He said competition among insurance companies is expected to ease this year.
"However, I believe this might not last as companies will have to restore their profitability, especially as the Office of the Insurance Commission raises the minimum capital adequacy ratio," said Mr Seigne.
Axa also anticipates a shift towards more customer-centric services and the use of advanced analytics and artificial intelligence to better meet customer needs and preferences, setting a high bar for innovation and service quality in the industry, he said.