Insurance market sees 25% growth

The insurance market grew by more than 25 per cent in the first nine months, according to the Association of Vietnamese Insurers.

The non-life insurance sector reported growth of 25.97 per cent in premium income, which topped VND12.417 trillion (US$621 million).

Motor vehicles represented the largest segment, with VND3.885 trillion, up almost a fifth over the same period in 2009.

Health and personal accident insurance followed with almost VND1.7 trillion, up 28.74 per cent, ahead of construction and installation with VND1.43 trillion (28.3 per cent).

Though still a small segment with VND6.1 billion, agricultural insurance achieved the highest growth of 520 per cent.

Credit insurance was 148 per cent up at VND14 billion, while fire and explosion cover rose 77 per cent to VND254 billion.

Bao Viet was the largest player with premium incomes of more than VND3 trillion, followed by PetroVietnam Insurance Company with VND2.85 trillion, and Bao Minh with over VND1.5 trillion.

Smaller companies achieved higher growth rates – MSIG’s premium income rose by 297 per cent, Groupama’s by 205 per cent, and ACE’s by 153 per cent.

Claim settlements were worth VND4.248 trillion during the period. The association said there will be a sharp rise in the fourth quarter due to the recent floods in the central region.

Thai Van Cach, deputy general director of the Vien Dong Assurance Company, said preliminary estimates put the damage caused by two storms in October in the provinces of Nghe An, Ha Tinh, Quang Binh, and Quang Tri at VND8.5 trillion.

They killed 165 people and injured 117 others, damaged around 440 houses, and killed livestock.

“Only half of the 165 people killed were insured, meaning a total payout of around VND3 billion. Auto losses were less than VND5 billion and most of the damaged roads were not insured,” he said.

Clearly, insurance companies have yet to tap the market’s potential.

Cach said if insurance companies manage to persuade importers to switch to FOB (free on board) mode from the current CIF (cost, insurance and freight), Vitenamese insurers will benefit since under the current practice the exporters pay the insurance in their home country.

The life insurance sector reported premium incomes of VND 9.767 trillion, a 25 per cent rise year on year.

Prudential topped the industry with more than VND3.8 trillion, up 12.9 per cent.

New contracts accounted for VND2.478 trillion of the premiums paid, a 35 per cent increase.

Bao Viet collected VND2.944 trillion (27.4 per cent) and Manulife was in third place with over VND1 trillion (53.4 per cent).

The companies collected premiums on 4.143 million contracts, 4 per cent higher than a year earlier. — VNS

Tags: Vietnam insurance market