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Insurance

Introduction to Insurance

          Individual life insurance policies in Thailand can basically categorized into 4 types, which are:

          1. Whole Life
          It aims to compensate the beneficiary in case of death of the assured . This type of insurance provides protection for the whole life of the assured or untill the assured reach the age of 99.

          2. Savings or Endowment
          It  offers the benefit of fixed deposit couple with the benefit of  life insurance. The policy provides protection for a limited period of time as may stipulated such as 10 / 15 / 20 / 25 or 30 years. The assured will attain (1) financial benefit in every 3 or 5 as is specified (2) coverage benefit as he/she stays alive at the end of the contract. The beneficiary will attain death benefit only in case the assured dies within the insured period.

          3. Term Life
          Term insurance provides protection for a term period of 5 / 10 / 15  or 20 years as may stipulated. The beneficiary will attain death benefit if the assured dies during the term. However, if the assured outlive the term, he/she will not receive any form of cash value in return.

          4. Retirement or Regular Income
          It is designed to respond to retirement needs.The assured will attain equal amount of cash in return upon retirement until death or at a period as is specified on condition that he/she pays premiums for a specified period.

Insurance for Retirement Purpose

          The fourth type as mentioned above is designed to include life coverage and retirement savings of the policyholder. The assured makes premium payments for a specified period to get life coverage and after retirement age he/she will receive cash back on regular basis.

           Example of insurance for retirement purpose:

     1.  The assured makes premium payments for a period of 10 or 20 years as specified. Such period will be subject to the age of the assured.

     2.  After ceasing premium payment, the policyholder will receive the following benefits;
          2.1 Life protection for a period which can be 10 / 20 or 99 years of age as specified.
          2.2 Other forms of cash values such as
                 2.2.1 Lump sum amount of ( 2% of coverage amount x years of premium payment )
                 2.2.2 Yearly amount of 10% of  coverage amount.
          2.3  Dividends generated from investment.

           Tax Benefits

          Premium paid for an insurance policy with the term of at least 10 years at an insurance company incorporated in Thailand is tax exempted for the amount actually paid but not exceeding 50,000 baht per year. Benefits received from the life insurance policy are also tax exempted.

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Last update : April 20, 2006

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