Insurance has its fair share of of terminology which can confuse people who do not work in the industry. One such area of confusion regards onshore and offshore insurance policies. The following article looks at the differences between the two, and explains why onshore policies are the best way forwards for those living in Thailand. If having read this article you still have questions, then please do not hesitate to contact us directly.
For people who live in Thailand, an onshore policy is one which has been purchased from a Thai based, and Thai regulated insurance company. In Thailand, insurance is regulated by the Office of the Insurance Commission (OIC). This regulatory body protects consumers who purchase insurance products in Thailand. The OIC stipulates that any licensed broker or intermediary in Thailand only sells onshore products which it has approved. With this, the OIC provides a level of protection to the consumer should you have a dispute with a Thai based insurer. Other benefits of buying an onshore policy include tax deductibility for business, and the ability to physically go and meet the insurer should the need arise. Furthermore, financial transactions are conducted in THB which is a benefit for many who have their salaries paid in THB. Another benefit is that local hospitals are more likely to have arrangements in place with onshore providers which facilitate direct billing between the hospital and the insurer. This means the client is less likely to have to pay and then claim later.
Offshore policies are any insurance products purchased from insurers who are based outside of Thailand. These can include companies based in Singapore and Hong Kong. There are several issues you should be aware of if you are planning on using an offshore provider. Firstly the OIC would not be able to help you should you have a dispute with an offshore provider. You would need to take up any legal case in the Jurisdiction where the insurer is licensed. This is likely to be expensive and problematic leaving you little in the way of redress. The currency you deal in will not be in THB and if you are the type of person who likes the idea of being able to visit a company if needed, then offshore plans will not be for you. Also, offshore providers are unlikely to have direct billing arrangements in place with local hospitals. Therefore you may find yourself having to pay the bills and be reimbursed at a later date.