Although the economy was heavily affected by the Covid-19 pandemic, insurers in Vietnam actively introduced solutions such as promoting technology investment and expanding distribution channels, so the insurance industry still had decent growth. According to data from the Ministry of Finance, in the first two months of 2021, the total assets of Vietnamese insurers totaled VND582,385 billion, representing year-on-year growth of 24.1%.

Quick adaptation to new situations

A number of new insurers recently boosted business cooperation with banks, showing that the market potential is still very large. For example, VietinBank and Manulife signed an agreement on a 16-year exclusive partnership to distribute life insurance. ACB shook hands with Sun Life Vietnam to distribute life insurance products exclusively for a period of 15 years.

Vietnam is home to 70 insurers, including 31 non-life insurers, 18 life insurers, two reinsurers and 19 insurance brokers. There is also a branch of a foreign non-life insurance business.

The industry’s total assets were estimated at VND582,385 billion in the first two months of 2021, up 24.10% year on year, including VND100,215 billion of non-life insurers and VND 422,060 billion of life insurers.

Insurers invested VND470,893 billion back to the economy, 22.85% more than a year ago, of which non-life insurers accounted for VND24,203 billion and life insurers accounted for VND345,786 billion.

Data from insurance authorities showed that, in 2020, the revenue of the insurance market grew more and insurers worked safely and efficiently. In addition, their financial capacity, governance and risk management capabilities constantly improved.

Insurers satisfactorily resolved insurance benefits for policyholders, making insurance trusted as a safe financial shield against all risks. In 2020, insurers paid insurance benefits of VND48,223 billion, including VND23,108 billion by non-life insurers and VND25,115 billion by life insurers.

Faced with recent difficulties, insurers have been very actively adapting their business to the new situation. They have actively reviewed and reduced costs to improve operational efficiency, supplement charter capital to strengthen financial capacity and expand distribution channels, especially insurance sales through banks and online insurance distribution.

On the other hand, they have increased investments in information technology and digital transformation to enhance service quality and customer experience, such as online insurance settlement program (Eclaim), electronic hospital guarantee cards, online insurance consultation via Chatbot, AI-based healthcare application, information technology application in remote sales training and consultation, and comprehensive digital ecosystem for sales teams and customers.

In addition, insurers have launched health insurance and healthcare products with a variety of benefits such as cancer, hospitalization, surgery, medical examination and treatment insurance with coverage in Vietnam and across the globe to meet the rising healthcare needs of the insured.

By adapting to the new situation, besides strong financial capacity, extensive network system and continuous launch of reasonable products, insurers are hoping for revenue and market share to grow further in 2021.

Professionalized insurance distribution channels

To further spur steady insurance market development in 2021, it is necessary to study, complete and submit the revised insurance law and related legal documents to the National Assembly approval, said Mr. Ngo Viet Trung, Deputy Director of the Insurance Supervision and Administration Department under the Ministry of Finance.

In addition, it is important to enhance information transparency of insurance companies; develop and professionalize insurance distribution channels to keep pace with the progress of the Fourth Industrial Revolution; consolidate the effectiveness of State management, inspection, supervision and administrative sanctions.

In addition, it is necessary to focus on developing and improving personnel quality; strengthen the role of professional associations as lead bodies to bridge insurers as well as relevant agencies to effectively implement insurance policies and strengthen connectivity with social insurance and commercial health insurance, establish information technology system and technical infrastructure, and build a database for the insurance market, he added.