The life insurance industry is expected to maintain growth in the second half of 2026, driven by rising demand for health protection, retirement planning and investment-linked products, despite persistent economic uncertainty and weaker household purchasing power, according to the Thai Life Assurance Association (TLAA).
TLAA president Nusara Banyatpiyaphod said the industry is on track to achieve its full-year premium growth target of 2.5-3.5%, with total premiums reaching 690-700 billion baht.
During the first six months, total premiums rose 4.57% year-on-year to 342 billion baht, supported by strong renewal premiums, which soared 6.94%, while policy persistency remained high at 84%.
Although premium growth is expected to ease in the third quarter due to seasonal factors, the final three months are traditionally the industry's strongest sales period. However, growth may moderate because of a high base in the same period of 2025.
GROWTH ENGINES
According to TLAA, the market is undergoing a structural shift from traditional savings products towards protection-oriented insurance, including health, critical illness, retirement and investment-linked policies.
"The industry is no longer driven solely by savings products," said Ms Nusara. "Consumers are increasingly seeking financial protection, retirement security and investment opportunities through life insurance."
Health insurance continues to benefit from growing public awareness of rising medical costs, with premium income increasing 3.96% to 63.6 billion baht during the first half.
Pension insurance premiums climbed 7.67% as the country's transition to a super-aged society encourages long-term retirement planning, while unit-linked insurance posted the fastest growth, surging 41.5%, reflecting stronger demand for products combining life protection with investment opportunities.
The association is working with the Office of the Insurance Commission to introduce more flexible pension products, including partial lump-sum withdrawals at retirement, step-up pension payments and more personalised benefit structures to address longevity risk.
While life agents remain the largest distribution channel, with a 48.2% market share, digital sales recorded the fastest expansion, jumping 77.5% from a year earlier as consumers increasingly purchase insurance products online.
Insurers are accelerating investments in digital platforms, artificial intelligence and data analytics to improve the customer experience, enhance underwriting efficiency and develop personalised products.
The industry is also adopting electronic policies, digital signatures and automated processes to strengthen operational efficiency and reduce fraud risks over the longer term.
CONSERVATIVE PORTFOLIOS
Despite growing interest in investment-linked products, insurers continue to maintain conservative investment portfolios.
The industry's investment assets total roughly 4.4 trillion baht, with around 84.5% invested in fixed-income securities to match long-term liabilities and comply with regulatory capital requirements.
Meanwhile, prolonged low and volatile interest rates are prompting insurers to reduce their reliance on traditional guaranteed-return savings products in favour of participatory, protection and unit-linked policies.
TLAA anticipates the sector will continue to face headwinds from fragile household purchasing power, elevated household debt, geopolitical tensions and global economic volatility.
Higher compliance costs under TFRS 17, climate-related risks and evolving regulatory requirements will require insurers to strengthen risk management and operational resilience, noted the association.
Insurance penetration remains relatively low. Life insurance premiums accounted for 3.68% of GDP in the first quarter of 2026, while only 38-39% of the Thai population holds life insurance policies, leaving significant room for long-term market expansion.
Looking ahead, demographic challenges, rising healthcare awareness and retirement planning are expected to remain the industry's primary growth drivers. As consumer demand shifts towards protection, personalisation and investment solutions, Thailand's life insurance sector appears positioned for sustainable growth despite a challenging economic backdrop, said Ms Nusara.
