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Title: The Potential Impact of Thailand-United States Free Trade Agreement on Life Insurance Businesses in Thailand
Authors: Harnhirun, Somchai 
Rattanasoonthorn, Chutinun 
Issue Date: 2008
Publisher: Chulalongkorn University Printing House
University of the Thai Chamber of Commerce
Source: Somchai Harnhirun, Chutinun Rattanasoonthorn (2008) The Potential Impact of Thailand-United States Free Trade Agreement on Life Insurance Businesses in Thailand. University of the Thai Chamber of Commerce Journal Vol.28 No.4.
Journal: University of the Thai Chamber of Commerce Journal 
Abstract: The principal objectives of this paper are to analyze the potential impact of Thailandand the United States Free Trade Agreement on life insurance businesses and howthe businesses could respond to the situation. By employing the concept of Structure-Conduct-Performance, it has been found that the life insurance business in Thailandis likely to be an oligopoly-structured market with a large market share in the hands ofa few large firms. Moreover, the study also found that the competition in the industrywill tend to be non-price competition. The results also indicate that although domesticlife insurance companies have an impressive overall competition performance, theycannot respond to the needs of their consumers very well. This could be becauseThai life insurance firms have failed to place enough importance and attention on somecompetitive factors. With regard to business performance, the financial ratios show thatthe performance of life insurance businesses is relatively high. Prior to the Thai-USFTA, the number of new entrants is expected to increase in the market. Consequently,a decrease in market share for all incumbents and a decline in ROI and ROA will beobserved in this business. To respond to the change in the business environment as aresult of the FTA generating fiercer competition, the incumbents will be forced to acquirenew capital for expanding their business range in order to maintain their market share.Joint ventures with strategic partners could be one of the best strategies for Thai firms,as well as improving their services and product quality.
ISSN: 0125-2437
Rights: This work is protected by copyright. Reproduction or distribution of the work in any format is prohibited without written permission of the copyright owner.
Appears in Collections:JEO: Journal Articles

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