Background and rationale

The Office of Insurance Commission (OIC) has issued Notifications re: Rules and Procedures for the Issuing and Offering for Sale of Insurance Products by Life and Non-Life Insurance Companies, and the Operations of Insurance Agents and Licensed Brokers (Notifications). The Notifications came into effect on 1 January 2019 and have replaced its previous drafts.

Key concepts

A substantial portion of the key concepts presented in the draft versions are retained in the Notifications. For further details, please see our June 2018 Client Alert.

The Notifications focus on good corporate governance, fair treatment of customers and places obligations on insurance companies to include certain procedures into their operations, including risk management and internal controls. Specifically, the Notifications cover the following:

  • Corporate culture and the roles of the board of directors and management
  • Issuance of policies
  • Sale of policies
  • Requirements for sales
  • Sale of insurance by the insurer's staff, employees, agents, or brokers
  • Telesales
  • Bancassurance sales
  • Direct mail sales
  • Provision of after-sales services
  • Penalties for violation and breach

Key focus

Some key points under the Notifications include:

  • The sale of insurance policies via electronic platforms is now recognized by the Notifications and is subject to the OIC's notification concerning sales via electronic means.
  • Banks are now authorized to conduct telesales.
  • For transactions conducted via bancassurance channels, bank employees with a broker license are allowed to conduct face-to-face sales only at authorized banks and its branches.
  • Employees, agents or brokers who sell insurance policies outside of the insurance broker's head office — including at temporary locations — are required to notify the insurer in advance. They must provide information such as the names of the salespeople and the duration of the sale, in order to allow insurers to adequately supervise the activity.
  • For sales via telemarketing, bancassurance, and direct mail channels, the premiums must be directly deposited into the insurer’s account.


It is essential that insurers familiarize themselves with the new requirements, in order to ensure compliance with the more stringent measures. The OIC has the authority to order any insurance company acting in breach of the Notifications to immediately rectify its actions if the company unintentionally acts in breach of the Notifications and the breach can be rectified. If the company does not rectify its actions without an appropriate reason or intentionally acts in breach of the Notifications, the OIC may order the company to halt certain operations. The same penalty applies to agents, brokers, and banks, as their licenses could be revoked. In addition, the OIC has the authority to enforce legal sanctions as stipulated in the Life Insurance Act B.E. 2535 (1992) and the Non-Life Insurance Act B.E. 2535 (1992).

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