Khun Thanasak Hoontrakul is the co-Founder of Vouch and Country Head of its subsidiary in Thailand, FairDee. Vouch is a peer-to-peer motor insurance platform that partners with insurance companies, insurance agents and brokers in Singapore and Thailand. The platform allows social groups to buy insurance and grants cash back for groups that do not file claims. Most peer groups in Vouch’s portfolio consist of family members. Peer pressure is high not to make small claims because this would hurt the entire peer group as nobody would receive a cash back.
Vouch isn’t following a direct to consumer strategy, realizing that people in Southeast Asia want human interaction when it comes to insurance and generally want to talk to agents. Awareness does not seem to be the problem as K. Thanasak explains. Motor insurance makes up 50% of the non-life premium in Thailand and is a well-know product to most consumers.
Vouch and FairDee work very closely with the Office of Insurance Commission (OIC) and is currently the only tech company allowed to be in the regulatory sandbox. The insurance industry globally is highly regulated and Thailand is no exception. Companies that participate in the regulatory sandbox can get certain regulations waived in order to be able to explore new concepts and products in a controlled environment. They have been able to launch a new product within only four month while approval process normally takes 12-24 month.
K. Thanasak explains why peer-to-peer insurance is especially relevant for Southeast Asia. In Thailand, motor insurance premiums are based on the type of car one drives, not the safety or claim record of the driver. Vouch’s concept allows insurers to attract good risks by changing claims behavior. In Thailand, in particular, small claims are a problem. K. Thanasak shares that in Thailand there is no claims deductible and claims frequency is at 65% compared to 17% in Singapore and 10% in Malaysia.