The Knowledge Centre - Vietnam Insurance Sector - Untapped Potential

Vietnam Insurance MarketStore this angel in big sizeVietnam Insurance Sector: Untapped Potential

New Delhi, 9th May 2008: In contempo years, there has been a cogent bread-and-butter advance in Vietnam of about 7.5% per annum. This advance is attributable to the afresh adopted cardinal and abiding initiatives by the Vietnamese government. These accomplish accept automated and bigger the bread-and-butter basement of the country by alms added incentives for adopted investors and implementing a 10 year socio-economic development plan etc. The country has gradually migrated from a planned abridgement to a bazaar based abridgement by alive its focus from agronomical assembly to industries and services. With all these developments, Vietnam has become one of the fastest-growing economies in the world, averaging about 8% anniversary gross calm artefact (GDP) advance from 1990 to 1997 and 6.5% from 1998-2003. From 2004 to 2007, GDP grew over 8% annually. Vietnam is now able to attempt and get counted with bounded as able-bodied as all-around bread-and-butter countries. There has been a cogent access in inflows of adopted absolute and clandestine investment.

In the endure few years, Vietnamese allowance area has apparent a apparent growth. Today, admitting accepting actual young, Vietnamese activity allowance bazaar has already overtaken Indonesia and Philippines in agreement of bazaar penetration. This is because Insurance exceptional forms a beyond allotment of the country’s GDP. With aperture up of its allowance bazaar back 1996, added and added adopted insurers are accepting acceptance to the awful advantageous allowance bazaar in Vietnam. Foreign companies can now calmly accomplish in the country and are basic collective ventures with bounded companies in adjustment to access Vietnam and alter their clientele. In addition, a ambit of adopted activity insurers, including some ample Asian-based activity insurers (principally from Singapore, Taiwan, China and South Korea), accept set up adumbrative offices in Vietnam and are alive against accepting operating licenses. Investors from regions like Asia, US and Europe are aswell actively lobbying the Vietnamese government for acceptance to the bounded allowance market. Upon the country's accession to the World Trade Organization, adopted insurers apprehend to be accustomed to authorize added wholly endemic units and to account from progressively crumbling limitations on their ambit of business.

Market Performance & Forecast

In 2000, Insurance area was admired to be $177.12 million. Within the next 7 years, the absolute bazaar admeasurement of allowance area in Vietnam was estimated to be $1141.98 actor in 2007; a CAGR advance of 26.23% and an boilerplate advance amount of 33.25% during this tenure. Going forward, we are assured a CAGR advance of about 12.30% in the Vietnamese Insurance Sector amid 2007 and 2011. During this time period, the bazaar from $1141.98 actor will abound at an boilerplate amount of 16.25% and ability $2039.95 actor by the end of 2011.

Between 2000 and 2007, Vietnamese activity allowance area added from $51.12 actor to $586.24 million, CAGR advance of 35.65% during this period. We anticipation that the activity allowance bazaar in Vietnam would abound at a CAGR of 10.71% and an anniversary boilerplate advance amount of 13.21% amid 2007 and 2011. From $596.24 actor in 2007, the bazaar will access by about $388 actor and ability $975.21 actor by the end of 2011.

Non-life premiums in Vietnam were estimated to be $555.74 actor in 2007, a advance of $429.74 actor from the bazaar admeasurement of $126.00 actor in year 2000. Between 2007 and 2011, we activity a CAGR of 13.89% .i.e. from $555.74 actor in 2007; the non-life allowance area in Vietnam will ability $1064.75 million.

According to the Vietnam Insurance Association, there are 120,000 allowance agents and 10,000 advisers in the country. There are currently 16 non-life insurers, eight activity insurers and seven allowance brokers. Vietnam's activity insurers action about 100 articles and generated exceptional income. Fifteen adopted insurers accept accustomed operations and 30 others accept adumbrative offices. Foreign-owned insurers boss the activity allowance market. Domestic insurers are added ascendant in the non-life allowance bazaar and adopted insurers authority alone a 7 percent bazaar share. Some of the top allowance companies in Vietnam are ACE Life Insurance Co., Ltd., AIG General Insurance (Vietnam) Company Limited, Bao Viet Holdings, Bao Minh, Groupama/GAN, Nipponkoa Insurance Co., Ltd., Prudential Vietnam Assurance, Petrolimex Joint Stock Insurance Company (PJICO), Petrovietnam Insurance Company (PVIC), and QBE Insurance (Vietnam) Company Limited etc.

Major Driving Factors
=> Economic advance aloft 8 percent
=> Entry to the World Trade Organization (WTO)
=> Opening up of allowance bazaar for adopted investments
=> US-Vietnam alternate barter acceding in 2001
=> Emerging average chic & accretion articulacy rate
=> Increasing adopted absolute investments
=> And abounding more…

Major Issues & Trends
=> Foreign investors targeting Vietnamese Insurance Sector
=> Foreign companies aggravating to abduction Vietnamese Market
=> Insurance still in a beginning date due to acceptable mindset
=> Lack of basement and support
=> Setting up of a civic export-credit allowance organisation
=> Demand for accident blockage increasing
=> Staffing apropos in allowance companies
=> Establishment of the Laos-Vietnam Insurance Joint Venture (LVI)
=> Recent developments at Bao Viet
=> And abounding more…

Topics covered in the report
=> Economic achievement of Vietnam
=> Recent bread-and-butter behavior of the Communist Party
=> Macroeconomic trends and drivers
=> Focus on accretion Foreign Direct Investments and aperture up of allowance market
=> Past and present book of Vietnamese Insurance Market & Future Outlook
=> Past and present book of Vietnamese Life Insurance Market & Future Outlook
=> Past and present book of Vietnamese Non-Life Insurance Market & Future Outlook
=> Driving factors for Vietnamese Insurance Market
=> Entry in WTO
=> Setting up of a civic export-credit allowance organisation
=> Establishment of the Laos-Vietnam Insurance Joint Venture (LVI)
=> Government cardinal initiatives to strengthen Insurance Market
=> Competitive Landscape & Market Share of adopted and calm players
=> Recent developments in Bao Viet
=> Company profiles of top players
=> And abounding more…

Table of Contents

1. VIETNAM
1.1 VIETNAMESE ECONOMY
1.2 GOVERNMENT POLICIES
2. INSURANCE SECTOR
2.1 MARKET OVERVIEW
2.2 MARKET SEGMENTATION & PERFORMANCE
2.2.1 Vietnamese Insurance Market
2.2.1.1 Life Insurance Sector
2.2.1.2 Non-Life Insurance Sector
2.3 DRIVING FACTORS
2.3.1 Recent catalysts
2.3.2 Young and active population
2.3.3 Emerging middles class
2.3.4 Literacy rate
2.3.5 War of talent
2.3.6 Increasing adopted absolute investment (FDI)
2.4 TRENDS, ISSUES AND OPPORTUNITIES – AN ANALYSIS
2.4.1 Foreign investors targeting Vietnamese Insurance Sector
2.4.2 Entry in WTO
2.4.3 Foreign companies aggravating to abduction Vietnamese Market
2.4.4 Traditional mindset of the humans – Insurance still in a beginning stage
2.4.5 Inadequate basal basement and support
2.4.6 Underselling to abduction market
2.4.7 Setting up of a civic export-credit allowance organisation
2.4.8 Underlying befalling for activity allowance behavior – charge for accident prevention
2.4.9 Entry of adopted players & staffing concerns
2.4.10 Historical bread-and-butter advance trends
2.4.11 Establishment of the Laos-Vietnam Insurance Joint Venture (LVI)
2.4.12 Factors active investment decisions
2.4.13 Transformation at Bao Viet
2.4.14 HSBC enters cardinal accord with top Vietnam insurer, Bao Viet
2.5 GOVERNMENT REGULATIONS
2.6 COMPETITIVE LANDSCAPE & MARKET SHARE
2.6.1 Company Profiles
2.6.1.1 ACE Life Insurance Co., Ltd.
2.6.1.2 AIG General Insurance (Vietnam) Company Limited
2.6.1.3 Bao Viet Holdings
2.6.1.4 Bao Minh
2.6.1.5 Groupama/GAN
2.6.1.6 Nipponkoa Insurance Co., Ltd.
2.6.1.7 Prudential Vietnam Assurance
2.6.1.8 Petrolimex Joint Stock Insurance Company (PJICO)
2.6.1.9 Petrovietnam Insurance Company (PVIC)
2.6.1.10 QBE Insurance (Vietnam) Company Limited

Pages: 107; Format: PDF
Authors: Akash Rakyan & Nishith Srivastava

List of Charts

Chart 1: Macroeconomic Data: Population (mil.) vs. Nominal GDP ($ billions): 2002-2011
Chart 2: Macroeconomic Data: GDP per basic ($mil.) vs. Real GDP Growth (%): 2002-2011
Chart 3: Vietnam Insurance Market ($million): 2000-2007e
Chart 4: Vietnam Insurance Market Forecast ($million): 2007e-2011f
Chart 5: Vietnam Life Insurance Market Value ($million): 2000-2007e
Chart 6: Vietnam Life Insurance Market Value Forecast ($million): 2007e-2011f
Chart 7: Vietnam Non-Life Insurance Market Value ($million): 2000-2007e
Chart 8: Vietnam Non-Life Insurance Market Value Forecast ($million): 2007e-2011f
Chart 9: Market Share of Life Insurance Companies in Vietnam
Chart 10: Market Share of Non-Life Insurance Companies in Vietnam

List of Tables

Table 1: Macroeconomic Data: Population (mil.) vs. Nominal GDP ($ billions): 2002-2011
Table 2: Macroeconomic Data: GDP per basic ($mil.) vs. Real GDP Growth (%): 2002-2011
Table 3: Vietnam Insurance Market ($million): 2000-2007e
Table 4: Vietnam Insurance Market Forecast ($million): 2007e-2011f
Table 5: Vietnam Life Insurance Market Value ($million): 2000-2007e
Table 6: Vietnam Life Insurance Market Value Forecast ($million): 2007e-2011f
Table 7: Vietnam Non-Life Insurance Market Value ($million): 2000-2007e
Table 8: Vietnam Life Insurance Market Value Forecast ($million): 2007e-2011

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