Thailand's OIC Updates Investment Rules for Insurance Companies

Thailand's Office of Insurance Commission (OIC) released a new comprehensive Notification on 25 November 2025 outlining updated regulations for investment and business operations of life and non-life insurance companies, effective 1 December 2025. This reform consolidates eight previous notifications into a streamlined framework aimed at broadening permissible asset classes and updating investment conditions. A key feature is the introduction of a Risk Proportionality screening framework which categorizes insurers based on financial health and internal risk management, determining their eligibility for investing in newer asset classes such as hedge funds, private credit funds, and venture capital. Under the updated guidelines, investment limits have been relaxed for insurers passing higher risk screenings, including increased ceilings on domestic and foreign equity investments. There is also a notable expansion in the allowable asset classes, reflecting a move toward more diversified and flexible investment opportunities consistent with evolving economic and risk landscapes. This is aligned with global trends promoting alternative investment strategies like digital assets and private markets. Governance structures at insurance companies have undergone significant changes, assigning greater authority and accountability to Boards of Directors (BOD) and Investment Committees (IC). The BOD now has the power to approve most investment decisions internally without prior OIC approval, though the OIC requires notification of significant investments. Investment Committees must include at least one-third BOD members and report quarterly on investment performance, enhancing oversight and transparency. These regulatory updates shift supervision from prescriptive pre-approvals to enhanced internal governance and risk-based assessments, offering insurers increased agility in asset allocation and portfolio diversification. While providing new investment channels, the Notification mandates that companies carefully comply with specific regulatory criteria and internal controls for each permitted asset class. Legal advisories emphasize the importance of tailored compliance strategies in navigating these regulatory changes. Overall, the OIC's Notification reflects a regulatory trend toward balancing market innovation, risk management, and corporate governance in the insurance sector, supporting insurers in adapting to dynamic market environments while safeguarding financial stability and policyholder interests.