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Tokio Marine Safety Insurance (Thailand) Public Company Limited
Notes to the Financial Statements

Tokio Marine Safety Insurance (Thailand) Public Company Limited
For the year ended 31 December 2023
Notes to the Financial Statements
For the year ended 31 December 2023

(c) Commission and brokerage
Commission and brokerage are recognised as income or expenses in the year in which they occur.
(d) Interest and dividends

Interest is recognised on an accrual basis. Dividends are recognised when the right to receive
the dividends is established.
(e) Losses and other expenses

Claims and losses adjustment expenses of direct insurance are recognised upon the
receipt of the claims advice from the insured, based on the claims notified by the insured
and estimates made by the claim specialist. The maximum value of claims estimated is
not however, to exceed the sum-insured under the relevant policy. Claims and losses
adjustment expenses of reinsurance are recognised as expenses when the reinsurer places the
loss advice or the statement of accounts with the Company. All other expenses are recognised on
an accrual basis.
4.19 Dividend distribution
Dividend distributed to the Company’s shareholders is recognised as a liability when interim
dividends are approved by the Board of Directors, and when the annual dividends are approved
by the shareholders.

5 Financial risk and insurance risk management
Risk management is an integral part of the internal control system of the Company’s business operations. The
Company being a member of the Tokio Marine Group (the “Tokio Marine Group”) takes into consideration
the risk management philosophy and business strategy of the Tokio Marine Group when managing
the risk of the Company. A Risk Management Framework is in place under the supervision of the Board of
Directors who is committed to maintain sound, robust and effective risk management process as part
of good business practice to safeguard the Company’s assets and investments as well as to protect the
shareholder’s and policyholders’ interests.

The Company manages and monitors the risk management process, plans and runs its operations in
accordance with the 3 Years Business Plan taking into consideration the Thailand market environment
and practice, business specialty and domain, size of business operations and capacity, degree of
management’s commitment, probabilities and impact of risks, and costs. It complies with regulatory
principles, recommendations and requirements on risk management in its risk management processes.
The Risk Management Committee comprising the President and senior management staffs, assists
the Board of Directors in identifying different types of risk and categories them into relevant risk groups,
including establishing appropriate Crisis Management and Business Continuity Plans. The Risk Management
Committee formulates appropriate risk management policies and operational guidelines. Including evaluating
the adequacy and efficiency of the Company's risk management to provide the opinions and necessary
recommendations to manage those risks.
Main risks of the Company are as follows:

(a) Insurance risk
Risk which may arise from failure to achieve strategic targets, inadequate planning or research,
slow response to business environmental changes, lack of credit control, unsuitable claims or
reserve management, poor underwriting, including large and catastrophic events. The inherent
uncertainty as to the occurrence, amount and timing of insurance liabilities as well as adverse
mortality, morbidity and persistency experience. As well as the inability to settle the claim and
financial position instability of reinsurance Company.
(b) Investment risk
Risk arising from economic slowdown and change in the market interest rates that will impact to
the failure in investment income budget.

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รายงานประจำาปี 2566 | ANNUAL REPORT 2023 | 135