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Vietnam insurance market grows drastically

Vietnam insurance market grows drastically

VNECONOMY updated: 16/11/2007

Viet Nam’s one-year membership of the World Trade Organisation (WTO) was marked with the beyond-expectation growth by the fledgling insurance industry, Viet Nam Insurance Association General Secretary Phung Dac Loc said.

He said the sector registered a 31 percent increase, or five-year high, in non-life premium revenue of almost 6 trillion VND in the first nine months of 2007. Life premium revenues also recorded a three-year high with a growth rate of over 10 percent.

Loc attributed the drastic growth to local businesses’ good preparations in the pre-WTO member period through re-insurance services.

He said the country has taken huge steps forwards in opening the insurance market, which now welcomes 30 enterprises, including 16 from other countries. As many as 700 non-life insurance products and over 100 life insurance products are now available in the market.

Domestic players have managed to take advantage of the “host playground” to corner over 80 percent of the luxury non-life market in a fierce competition against foreign big names such as France ’s Prevoir and AIG, ACE Life and New York Life from the US .

But Loc said the industry should not be complacent, urging local companies to work harder on making long-term strategies to further expand their market shares.

“More products should be generated to compete against foreign rivals next year when the nation will lift all barriers against outsiders in line with its WTO commitments,” said the industrial leader.

The Viet Nam Insurance Association has also called on members to continue upgrading information technology to manage and control enterprises’ risks.

Experts predict a continuous trend in life insurance while the non-life insurance market will also make some progress in the years to come following the country’s full implementation of its WTO commitments.

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