The participation of foreign investors in Vietnam’s insurance market will help it to grow in terms of business as well as experience and governance.
According to a report by Bao Viet Securities Company (BVSC) on Vietnam’s insurance industry, the number of life insurance products in Vietnam rose from 100 in 2009 to 350 by the end of 2016. The number of non-life insurance products also surged from 200 in 1999 to more than 1,000 today, reported Vietnam News.
Bao Viet Securities says that capital increases, with the participation of foreign investors, have helped domestic insurers enhance their insurance capacity through training, legal framework and operation of products.
Meanwhile, modern distribution models of the local insurance industry have also been gradually developing, thanks to the participation of foreign investors.
A survey of Swiss Re shows that Vietnam’s non-life insurance market is trending to enlarge direct distribution channels, such as online or telesales, while the local life insurance market’s distribution is still mainly through intermediate agents.
Bancassurance was launched in Vietnam in 2001, while the online distribution channel was started in 2016.
Ms Ph?m Thu Phuong, deputy director of the Ministry of Finance’s Insurance Supervisory Authority, said last December that the insurance sector targets a total revenue of VND129.24 trillion (US$5.69 billion) this year, which would represent an increase of 22.38% over 2017. Insurance firms also target to increase their total assets by 22% to VND370.81 trillion by the end of this year.
The insurance industry is expected to benefit from the country’s projected GDP growth of more than 6% annually over the next three years.
The insurance market maintained a high growth rate of 21.2% in 2017 with total revenue reaching VND105.61 trillion. Total assets rose by 23.4% to VND302.94 trillion at the end of last year. A