The Japanese economic daily, Nikkei on August 11 carried an analysissaying that Vietnam's nonlife insurance market is attracting more andmore corporate and individual customers, and the intensifyingcompetition may spur a realignment among insurers.
It quoted the Vietnamese Ministry of Finance’s statistics that nonlifeinsurance premium revenue in the country is projected to increase by 15percent to 15.7 trillion VND (70 billion JPY) in 2010.
Sales of insurance policies for corporate customers -- the coresegment of the market -- are being driven by construction, fire andcargo insurance. The number of construction projects is surging in theSoutheast Asian country, as the government is promoting the constructionof infrastructure. Sales of fire insurance policies are rising alongwith the increase in foreign direct investment.
Alsoexpanding is the retail nonlife insurance market, where many of theproducts are for auto insurance, including that for motorbikes, andmedical coverage.
The growth is being driven byrising sales of cars and the increasing number of wealthy andmiddle-class people who want more extensive coverage than just publichealth insurance. Strong growth in the housing market is also fuelingsales of insurance to individuals.
Bao VietInsurance Corp. and BIDV Insurance Co. (BIC) started selling fireinsurance policies for condominiums this spring. The policies areoffered along with mortgage loans by the London-based HSBC Group and theBank for Investment and Development of Viet Nam (BIDV), with the formerpartnering with Bao Viet and the latter with BIC.
Vietnam International Assurance Co. (VIA), which is partly owned byJapan's Tokyo Marine & Nichido Fire Insurance Co., is the largestforeign player in Vietnam. It plans to start offering fire insurance forcondominiums this month and is considering partnering with a majorlocal bank.
Nikkei noted that the country's nonlifeinsurance market has been growing at a robust pace, but the competitionis getting heavy, making it difficult to generate profits. It isestimated that in 2009, only about 30 percent of all nonlife insurers inthe country profited from underwriting insurance policies.
An official at a foreign insurer was quoted by Nikkei as saying thatgiven the size of the market, some firms may go through a realignment,reducing the total number to about 15 in five to 10 years.
There are currently 29 domestic and foreign nonlife insurance companies in Vietnam./.
It quoted the Vietnamese Ministry of Finance’s statistics that nonlifeinsurance premium revenue in the country is projected to increase by 15percent to 15.7 trillion VND (70 billion JPY) in 2010.
Sales of insurance policies for corporate customers -- the coresegment of the market -- are being driven by construction, fire andcargo insurance. The number of construction projects is surging in theSoutheast Asian country, as the government is promoting the constructionof infrastructure. Sales of fire insurance policies are rising alongwith the increase in foreign direct investment.
Alsoexpanding is the retail nonlife insurance market, where many of theproducts are for auto insurance, including that for motorbikes, andmedical coverage.
The growth is being driven byrising sales of cars and the increasing number of wealthy andmiddle-class people who want more extensive coverage than just publichealth insurance. Strong growth in the housing market is also fuelingsales of insurance to individuals.
Bao VietInsurance Corp. and BIDV Insurance Co. (BIC) started selling fireinsurance policies for condominiums this spring. The policies areoffered along with mortgage loans by the London-based HSBC Group and theBank for Investment and Development of Viet Nam (BIDV), with the formerpartnering with Bao Viet and the latter with BIC.
Vietnam International Assurance Co. (VIA), which is partly owned byJapan's Tokyo Marine & Nichido Fire Insurance Co., is the largestforeign player in Vietnam. It plans to start offering fire insurance forcondominiums this month and is considering partnering with a majorlocal bank.
Nikkei noted that the country's nonlifeinsurance market has been growing at a robust pace, but the competitionis getting heavy, making it difficult to generate profits. It isestimated that in 2009, only about 30 percent of all nonlife insurers inthe country profited from underwriting insurance policies.
An official at a foreign insurer was quoted by Nikkei as saying thatgiven the size of the market, some firms may go through a realignment,reducing the total number to about 15 in five to 10 years.
There are currently 29 domestic and foreign nonlife insurance companies in Vietnam./.
