Vietnam fines insurers for collusion on motor vehicle fee hikes

The Competition Council under the Ministry of Industry and Trade has fined 19 insurance companies for violating the Competition Law by colluding with each other to increase insurance fees for motor vehicles.

These insurers were each charged 0.025% of their total revenues in 2007.

This would have the companies paying a total of VND1.7 billion ($89,000), it added.

On September 15, 2008, 15 of the 19 insurance companies signed an agreement and raised motor vehicle insurance fees to 1.56% of their retail value from previous 1.3%. The other four firms joined the pact fifteen days later.

“Of 25 insurance companies operating in motor vehicle insurance sector at that time, the 19 companies had 99.79% of the country’s market share. So, the agreement violated the Competition Law,” Bach Van Mung, head of the ministry’s Competition Department said.

He added that the agreement had negatively impacted the motor vehicle insurance market.

Do Gia Phan, chairman of the Vietnam Standards and Consumers Association, said customers who were directly affected by the agreement have the right to demand compensation.

Following is list of 19 fined insurers:

1. Agriculture Bank Insurance Joint Stock Corporation (ABIC)

2. Nha Rong Joint Stock Insurance Company

3. Bao Minh Insurance Corp (BMI)

4. Vietinbank Insurance JV Ltd. Co

5. Bao Tin Insurance JS Co

6. Bao Viet Insurance JS Corp

7. BIDV Insurance Company (BIC)

8. Military Insurance JS Co

9. Petrolimex Insurance Co

10. Postal Insurance JS Co

11. PetroVietnam Insurance Corp

12. Samsung Vina Insurance Ltd. Co

13. Global Insurance JS Co

14. Vien Dong Assurance Corp

15. Vietnam Int’l Insurance JV Co

16. AAA Insurance JS Co

17. Fubon Vietnam Insurance Ltd. Co

18. Groupama Vietnam Insurance Ltd. Co

19. Vietnam National Aviation Insurance Co

Tags: Vietnam insurance, Vietnam insurance industry, Vietnam insurance market

Posted by VBN on Aug 11 2010. Filed under Insurance. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry