The Right of Withdrawal for Consumers in General Insurance Contracts

Abstract

Individuals in society are constantly exposed to various forms of uncertainty and risk in their daily lives. Insurance functions as an economic tool and a form of consumer behavior aimed at protecting individuals from potential financial consequences arising from such risks. Insurance policies, which serve as evidence of general insurance contracts, are typically unilaterally prepared by insurers based on their business expertise and presented in standard form, which does not afford consumers a realistic opportunity to bargain over the terms. One approach in consumer protection involves the inclusion of a cooling-off period, a designated timeframe after contract conclusion during which consumers may withdraw from the contract. This period offers consumers an opportunity to review and understand the product and contract terms, particularly in complex or pre-drafted agreements. This study examines the characteristics of general insurance contracts, legal concepts related to contracts and consumer protection, and legal measures concerning consumer protection in general insurance contracts in selected foreign jurisdictions and Thailand. It concludes that consumers should be granted the right to terminate general insurance contracts within such a period, and that this right should be clearly disclosed during the offering of the insurance policy. The study also identifies gaps in Thailand’s current legal measures that result in inadequate protection for consumers.