Association plans to set up Natural Catastrophe Fund

The Thai General Insurance Association (TGIA) plans to establish a permanent Natural Catastrophe Fund in the first half of 2026 amid increasingly frequent and severe natural disasters in the country, with an initial sum of 50 billion baht.

- NUNTAWUN POLKUAMDEE

Full implementation of the fund is expected in 2027, meant to strengthen long-term risk management in the industry, said TGIA president Somporn Suebthawilkul.

Mr Somporn said Thailand has shifted from being a low-risk country for natural disasters to significantly higher catastrophe risks, particularly in 2025, including major floods in Hat Yai and an earthquake in March.

"The catastrophe fund will be a permanent mechanism, unlike the temporary fund established after the 2011 floods," he said. "Natural disasters are occurring more frequently and with greater severity, making long-term risk preparedness essential for the non-life insurance industry."

According to Mr Somporn, the fund will be financed through three main sources, comprising insurance premiums, a catastrophe bond fund and reinsurance.