Vietnam: Authorities to cut red tape for life insurers
Source: Asia Insurance Review | May 2019
The Ministry of Industry and Trade (MOIT) has recently proposed a draft decision to amend regulations so as to address unnecessary overlapping regulatory procedures for life insurers in Vietnam.
At issue are regulations under the law on consumer protection, overseen by the MOIT, and those under the Law on Insurance Business, administered by the Ministry of Finance (MOF).
Specifically, the draft decision proposes removing ‘life insurance’ from the list of essential goods and services subject to the ‘standard contracts and general trading conditions’ registration requirements under the law on consumer protection. Accordingly, life insurers will only need to register life insurance products with the Ministry of Finance’s (MOF) Insurance Supervisory Authority, says international law firm Baker McKenzie.
Over the last three years, life insurers in Vietnam have been subject to a registration requirement by the MOIT as the consumer protection authority for life insurance policies’ standard contracts and general terms and conditions. That process has created certain overlapping procedures with the existing approval process of life insurance products by the Insurance Supervisory Authority.
During 2016 and 2017, a decree was issued and followed by a coordinated process between the MOIT and the MOF to connect the MOF’s approval with the MOIT’s registration process. However, given that both ministries have still been involved, certain issues, including prolonged approval process remain outstanding.
The MOIT also said that the centralisation in management to a single authority (i.e., the MOF) is in line with international best practices. A