Hanoi (VNS/VNA) – Vietnam’s domestic insurance marketmanaged to pull through a difficult time in 2023 but it will take time for themarket to rebuild trust among consumers, according to policymakers and industryinsiders.

Experts have long voiced concerns over a lack of trust among consumers, evenbefore last year's insurance crisis, during which consumer trust was said to beat an all-time low after numerous scandals broke out, negatively impacting theentire industry. They said 2023 should be remembered as a valuable lesson forthe industry and the market.

In a recent report by the Ministry of Finance, insurance benefits payout in2023 was estimated at 86.37 trillion VND (3.57 billion USD), an increase of31.14% compared to the previous year, with non-life insurance companies paid 23.814trillion VND, while life insurance companies paid 62.562 trillion VND.

According to the ministry, timely and substantial payments have helpedindividuals and businesses overcome difficulties, stabilise production andbusiness activities, as well as contributing to the economy.

Since the crisis, regulatory agencies and insurance companies have takenmeasures to reassess the situation, considering it an opportunity to cleanseand readjust the market after a period of rapid growth. The focus is ondeveloping the market sustainably, transparently, and safely.

Solutions have been proposed by the ministry and its sub-department overseeingthe industry, the Insurance Management and Supervision Bureau, to enhancemarket transparency and safeguard the rights of insurance participants.

Ngo Viet Trung, the bureau's director, said the industry hasovercome one of its most challenging times but it will require additional timefor transformation towards increased depth, enhanced quality and more effectivecontribution to the country's socio-economic development.

In the future, the Ministry of Finance aims to manage and supervise insurancecompanies based on risk through safety capital checks, business classification,evaluation, risk management, and updating and improving early warning systems.Additionally, there will be a continued focus on managing, supervising,inspecting, checking and strictly handling law violations to increase legal deterrenceand compliance.

Under the 2022 Insurance Business Law, businesses will have to publiclydisclose information such as decisions on penalties for violations in insurancebusiness activities, court judgments and decisions regarding the company's insuranceactivities, and decisions to prosecute companies, managers, and controllers ofinsurance companies.

To ensure the sustainable development of insurance sales through banks, it isnecessary to not only enhance transparency in providing insurance through banksbut also focus on two main pillars: ensuring customers' active participation,respecting their choices and strengthening supervision to ensure the quality ofinsurance sales.

The ministry has stated that it will continue to direct the improvement ofinsurance business laws, enhance management, supervision, inspection, andchecks, and increase communication to disseminate information about insurancecontract laws./.