Illustrative photo. (Photo: VNA)

Deputy Minister of Finance Le Tan Can said that the insurance market is increasingly affirming its role in supporting social security policies, providing financial protection for investors, promoting international economic integration, and implementing urgent national programmes and tasks.

Currently, the Vietnamese insurance market comprises 85 companies, including 31 non-life insurance firms, one branch of a foreign non-life insurance company, 19 life insurance businesses, two reinsurance firms, and 32 insurance brokerage service providers.In 2024, the market's total assets were estimated to reach 986.6 trillion VND (38.9 million USD), a 9.7% increase compared to 2023. Insurance companies reinvested approximately 838.32 trillion VND (33 million USD) back into the economy, marking a 12.58% rise. The total equity hit 205.3 trillion VND, up 6.63%.

Director of the Department of Insurance Management and Supervision under the Ministry of Finance (MoF) Ngo Viet Trung said that by the end of November 2024, total insurance premium revenue was estimated at 204.11 trillion VND, up 0.22% year-on-year, while insurance payouts around 86.4 trillion VND, up 17.13%, reflecting the efforts of insurance companies and the sector's role in the economy.

However, insurance participation rate in Vietnam remains low, accounting for only about 2% of GDP, as compared to an average of 4% in Asia and 9% worldwide.Trung noted that insurance companies are increasingly utilising information technology across their operations, from sales to claim processing, while expanding their distribution networks and offering more comprehensive insurance solutions.

The MoF is also working to improve legal frameworks, helping the market operate in a more quality-driven, transparent, and sustainable manner. This includes requiring insurance companies to enhance the quality of consulting activities and services provided by insurance agents, through training, examination, and certification.

Additionally, in 2024, the insurance sector faced significant challenges due to the huge damage caused by Super Typhoon Yagi and widespread floods in many northern provinces.

According to Deputy Secretary-General of the Insurance Association of Vietnam Ngo Trung Dung, the insurance industry has managed claims and delivered payouts for customers in various natural disasters but none has been as costly as Typhoon Yagi.

As of November 22, 2024, damage from the typhoon was estimated at 11.461 trillion VND, covering both life and non-life insurance. Of this, over 10 trillion VND pertains to property insurance and insurance for construction projects.

Deputy Minister Can said that to ensure sustainable growth in the insurance market, insurance companies need to focus on reviewing and adjusting their business strategies to encompass market risks, ensuring sustainability and long-term commitments while complying with legal regulations.

Moreover, the insurance sector should diversify products to meet customer needs, improve service quality, and guarantee benefits for insurance participants.