Thailand Law Library

by Thailand Lawyer

Chapter 3: Insurance on Life

In a contract of insurance on life, the payment of the sum of money is dependent upon the life or death of a person.

The sum payable may be a lump sum or an annuity, as may be agreed between the parties.

Even in the case where the insured is not himself the beneficiary, he has the right to transfer the benefit of the contract to any other person unless he has delivered the policy to the beneficiary and the beneficiary has notified in writing the insurer his intention to take the benefit of the contract.

If the policy is made payable to order the provisions of Section 309 shall apply.

In case of avoidance of the contract under Section 865, the insurer has to return to the insured or to his heirs the redemption value of the policy.

If the age of the person upon whose life or death the payment of the sum depends has been incorrectly stated, in consequence of which a lower premium has been fixed. The sum to be paid by the insurer shall be reduced in the same proportion.

However the contract is voidable if it is proved by the insurer that the real age at the time when the contract was made was out of the age-limit according to his business practice.

The insured is entitled at any time to terminate the contract of insurance by discontinuing to pay the premium. If the premium had been paid for at least three years, he is entitled to receive from the insurer the surrender value of the policy or a paid up policy.

Whenever the sum is to be paid on the death of a person, the insurer is bound to pay it on such death unless:

1. Such person voluntarily committed suicide within one year after the date of the contract, or
2. Such person was intentionally killed by the beneficiary.

In case number 2, the insurer is bound to pay the insured or to his heirs the redemption value of the policy.

If the death is caused by the fault of a third person, the insurer cannot claim compensation from that person, but the heirs of the deceased do not lose their right to compensation from the third person, even if the sum payable under the contract of insurance on life reverts to them.

If the insured has made an insurance payable on his death in favor of his heirs without specifying any particular person, the sum payable shall be part of the assets of his estate available for his creditors.

If the insurance has been made in favor of a particular person, only the amount of the premiums paid by the insured shall be part of the assets of his estate available for his creditors.