Is the Era of 100% Full-Coverage Health Insurance Ending? When Giants AIA and Krungthai-AXA Close the Chapter on Popular Plans

This marks a significant development shaking both the insurance industry and consumers, as two market giants simultaneously signal the "discontinuation" of their flagship products within a similar timeframe.

Starting with Krungthai-AXA Life Insurance announcing it will cease selling the popular critical illness plan iCare (covering five major illnesses) on 31 January 2026, after more than 12 years on the market, citing rising critical illness statistics that no longer align with the original premium pricing.

Recently, AIA Thailand, the market leader, also announced it will end sales of AIA Health Happy, a full-coverage health insurance plan with maximum coverage of 25 million baht, beloved by the market for years, with sales ending on 31 March 2026.

The moves by these two "market leaders" are not coincidental but represent a "crucial inflection point" for Thailand's health insurance system, signaling that the era of "100% unconditional full-coverage health insurance" may be coming to an end.

Why must the business retreat?

Analyzing the communications from both major players from a business perspective, the discontinuation of these products reflects a "portfolio rebalancing" strategy aimed at long-term survival amid three pressing pressures.

1. Medical Inflation: Healthcare costs in Thailand have surged beyond the projections of statistical models from 5-10 years ago. Advances in medical technology have led to more frequent use of multi-million baht full-coverage limits. According to the Office of Insurance Commission (OIC), the main regulatory body for insurance, medical inflation rose about 15% in 2024.
2. Uncontrollable Loss Ratios: Changes in insured behavior toward "hospital stays for convenience" or excessive medical treatments (over-treatment) have caused insurers to bear high claim burdens, potentially threatening their long-term financial stability.
3. Aging Society: As Thai people live longer but suffer from chronic illnesses for extended periods, the healthcare burden shifts from cure to ongoing care, demanding massive resources.

Businesses must survive, and consumers must remain protected.

From a business standpoint, transitioning to co-payment systems or introducing deductibles since 2025 aims to instill "discipline in benefit usage" to sustain the insurance system and ensure insurers remain profitable enough to cover genuinely severe claims in the future.

Arpakorn Panlert, Deputy Secretary-General for Insurance Business Supervision at the OIC, revealed that by the end of 2024, inappropriate benefit usage accounted for 28% of loss ratios, despite only 5% of policies being utilized.

From the consumer perspective, this signals an unavoidable rise in costs. Future health insurance products will feature more complex conditions. Premiums may initially seem lower but include co-payments; obtaining the same comprehensive coverage as before will come at increasingly higher prices, potentially posing a heavy burden during retirement.

In this new health system era, who should bear responsibility?

OIC forecasts that total insurance premiums in 2026 may reach 1 trillion baht, reflecting increased public awareness of risk transfer to insurance. The key question remains: who will primarily bear the healthcare system's burden?

The future answer may not lie with insurers alone but rather in shared responsibility.

• Insurers need to design products emphasizing "preventive" measures rather than merely waiting to pay claims.
• Consumers must maintain their health to reduce benefit use and accept co-payment conditions to keep premiums affordable.
• Insurance agents must shift roles from "salespeople" to "health financial advisors," helping clients plan for rising premiums due to aging and evolving medical technologies.

How should consumers prepare?

1. Check-up: For existing policyholders of Health Happy or iCare, "do not let your policy lapse" as it is a valuable asset that guarantees benefits under the original terms as long as you renew.
2. The Last Call: For those without full-coverage insurance, the period before March 2026 is the final opportunity to "lock in" terms while insurers are still offering favorable conditions.
3. Long-term premium planning: Don't focus only on the first year's premium. Consider premiums at ages 60-70, and whether you have sufficient cash flow to handle potential increases or stricter conditions.

This cessation signals that the golden age of "buffet-style" insurance is ending, ushering in the era of "shared-cost health insurance" in full.

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