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Vietnam Insurance Market Report 2018


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Explore Vietnam Insurance Report with free preview including key players, overview of market value and performance

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Vietnam Insurance Market Report 2018

  1. 1. INDUSTRY PREVIEW Vietnam Insurance Market 2018
  2. 2. Table of Contents No Contents Page 1 Vietnam Insurance Market 3 - 11 1.1 Market Structure & Description 3 1.2 Size & Segmentation 4 1.3 Competition Dynamics 5 1.4 Key drivers 6 1.5 Market Prospects 7 1.6 Financial Indicators 8 1.7 Key players’ profiles 9 - 11 2 StoxPlus Introduction 12 – 22
  3. 3. Page 3 Market Structure & Description Source: StoxPlus from MOF Currently, there are 61 companies operating in Vietnam insurance market, mainly in life insurance and non-life insurance. Other companies include reinsurers and brokers Figure 1: Market Structure of Insurance Market, 1H2018 INSURANCE MARKET LIFE INSURANCE (18 companies , 9 representative offices ) NON-LIFE INSURANCE (30 companies, 14 representative offices) BROKERS (13 companies, 2 representative offices) • OVERVIEW: Life insurance continued recording a rapid growth of 28.7% 2012 – 2017 CAGR to US$ 2.9bn of premiums in 2017. This was thanks to higher income per capita as well as the awareness of life insurance to invest in long-term and mitigate risks from accidental disability and death. • KEY NAMES: Bao Viet Life, Dai-ichi Life, Manulife, Prudential • OVERVIEW: Non-life insurance kept stable with 12.2% 2012 – 2017 CAGR to US$ 1.8bn of premiums in 2017. Non-life insurance growth is driven by the growth corresponding market such as vehicles, healthcare, real estate, etc, Thanks to higher health care spending, health insurance grew fast and contributed to 50.8% YoY growth of non-life insurance in 1H2018. • KEY NAMES: Bao Viet Insurance, PVI, PTI, Bao Minh RE-INSURANCE (2 companies, 1 representative offices)
  4. 4. Source: StoxPlus from MOF Insurance market is growing rapidly by 20.7% CAGR in 2012 – 2017, with two main segments being life and non-life insurance SEGMENTS 1H2018 YoY Growth rate 2012-2017 CAGR Life 32.4% 28.7% Non-life 13.0% 12.2% Total market 26.0% 20.7% Figure 2: Market size by insurance premiums (US$bn) and YoY growth of Insurance Market, 2012 - 1H2018 • Insurance market’s total premiums was US$4.7bn in 2017 and US$2.6bn in 1H2018, posting a CAGR 2012 – 2017 of 20.7%. Better income and higher awareness are key drivers for the market’s performance. Compared to peers, Vietnam has much lower life insurance penetration rate and the market still has great potential to grow • Life insurance is the key segment with 28.7% CAGR 2012 – 2017, much higher than 12.2% CAGR of non-life insurance. The segment accounted for 62.7% total premiums in 1H2018. Life insurance is expected to continue growing rapidly with the participation of foreign players. Companies continue partnering with banks to access the customer database and utilize banks’ network. They also take the opportunities from e-commerce in offering products via online, mobile platforms. • Non-life insurance is expected to grow in medium and long-term when the economic growth reaches more advanced status. Along with product diversification, insurance companies are investing in technology in claims management to bring in better customer experience and cut down the cost from frauds. Size & Segmentation Page 4 0.9 1.1 1.3 1.7 2.2 2.9 1.2 1.6 1.1 1.2 1.3 1.4 1.6 1.8 0.9 1.0 14.0% 14.5% 15.2% 19.6% 21.2% 21.6% 22.4% 26.0% 2012 2013 2014 2015 2016 2017 1H2017 1H2018 Life Non-Life 2012 – 2017 CAGR = 20.7% Total YoY growth
  5. 5. While non-life insurance market share concentrates on the hand of domestic companies, foreign companies are leading the life insurance market Figure 3: Life insurance’s market share by premiums, 1H2018 Figure 4: Non-life insurance’s market share by premiums, 1H2018 18.9% 17.5% 16.5% 14.7% 10.1% 3.9% 3.8% 3.1% 2.8% 2.0% 6.8% Bao Viet Life Dai-ichi Life Prudential Manulife AIA Generali Chubb MB Ageas Hanwha Aviva Others Competitors Dynamics • Foreign companies dominate the life insurance market with more than 69.2% market share. This was thanks to customer preference as well as the companies’ experience and technical knowledge. Domestic players hold less than 30% market share with Bao Viet being the biggest name thanks to its reputation, the largest network (200 branches and 170,000 agents). Life insurance market still has growth potential, seeing higher competition among companies in acquiring new customers using new products (focusing on fatal disease insurance with short-term plans) and new channels (bancassurance, e-commerce). • The non-life insurance market is led by Vietnamese companies with more than 66.9% market share, foreign players’ market share is fragmented with 11 companies. Vietnamese companies’ leading position was thanks to their long historical development and foreign investors’ reluctance to join the highly competitive market. The market has become more competitive, seeing top-5 companies’ market share decreased from 70% to 60% in the past 5 years. Along with the 3 key sub-segments being vehicle, health and property, non-life insurers are competing in providing new products such as traveling insurance, agriculture product insurance, etc,. 20.8% 16.5% 8.6% 7.6% 6.1% 3.6% 2.7% 34.1% Bao Viet Insurance PVI PTI Bao Minh PJICO MIC VBI Others Source: StoxPlus from MOF Source: StoxPlus from MOF Page 5
  6. 6. Higher income and improved awareness are main drivers of insurance growth, especially for life insurance within the context of increasing risks of fatal diseases Figure 5: Real GDP per capita (US$), 2012 - 2017 Figure 6: % of Vietnamese population ages 65 and above, 2010 - 2016 Key drivers Source: StoxPlus from GSO Source: StoxPlus from GSO • Thanks to higher personal income, Vietnamese people are spending more on and better educated about long-term investment and financial services. This benefits the insurance market, especially in growing middle-income population, who haven’t exposed to insurance products before. The population proportion of middle-income people (monthly income from VND 7.5mn to VND 15mn) increased from 21% to 39% in 2012 – 2016. • In addition, higher health awareness when the Vietnamese population is becoming older and noninfectious disease death is increasing also contributed to the growth of the life insurance market and healthcare segment of non-life insurance market • Vietnamese population is becoming older with increasing percentage of population ages 45 and above from 26.8% to 31.2% from 2014 to 2016 • According to Vietnam’s Insitute of Cancer research and preventation, cancer rate is increasing rapidly from 69,000 new patients in 2000 to 150,000 and 200,000 new patients in 2015 and 2020e (source). People care more about mitigating risks from this fatal disease, resulting in a focus on cancer insurance products Page 6 24.7% 23.9% 23.5% 23.8% 26.9% 25.7% 26.8% 22.3% 22.5% 22.8% 22.9% 22.7% 16.5% 17.5% 16.7% 19.2% 9.4% 10.1% 10.1% 11.9% 2010 2012 2014 2016 >= 60 45 - 59 30 - 44 15 - 29 0 - 14 1,504.5 1,755.6 1,893.9 2,030.0 2,036.4 2,138.0 2012 2013 2014 2015 2016 2017
  7. 7. Vietnam insurance market has great potential as the penetration rate is still low compared to its peers, while performance in the recent years has been topping the region Figure 7: Insurance penetration of Vietnam and peer countries (Total premiums as a % of GDP), 2017 Figure 8: Insurance premium growth of Vietnam insurance and peer countries, YoY 2017 Market prospects Source: StoxPlus from Swiss Re Institute Source: StoxPlus from The World Bank • Compared to other peer countries, Vietnam’s insurance penetration is much lower with premiums equal 2.1% of GDP in 2017. The market has great potential for growth and with 3 – 4% planned penetration rate in 2020 (according to the Vietnam’s insurance market development strategy). The progress is clear when 2017’s penetration rate was higher than the 2016’s rate of 1.8% • Regarding growth, both life and non-life insurance performed well compared to peer countries. The market is expected to focus more on middle-income customers acquisition via online and bank channels while keep high-income customers’ loyalty using products with larger coverage and compensation (Eg: Bao Viet’Intercare packages cover customer aged 15 – 75 and compensate to VND 10bn) 28.8% 4.2% 31.6% 8.0% 23.0% 22.6% 10.0% 5.8% 7.6% -0.7% 11.9% 1.5% Vietnam Thailand Indonesia Malaysia China Singapore Life Non-life Page 7 2.1% 2.4% 4.6% 4.8% 5.3% 8.2% Vietnam Indonesia China Malaysia Thailand Singapore
  8. 8. Financial Indicators Our Biinform portal provides ~ 1 million available company reports ready to purchase Figure 9: Selected Financial Indicators (US$mn) of Key Players In insurance market, 2016 Source: StoxPlus Note: The net insurance premiums takes into account both direct and reinsurance activities COMPANY TYPE SEGMENT NET INSURANCE PREMIUMS CLAIM EXPENSES NET PROFIT AFTER TAX TOTAL ASSET OWNER’S EQUITY US$mn US$mn US$mn US$mn US$mn Prudential Vietnam Ltd Foreign-owned Life insurance 587.3 554.3 56.3 2,644.3 251.6 Dai-ichi Life Vietnam Ltd Foreign-owned Life insurance 226.7 187.9 4.8 475.9 129.1 Manulife Vietnam Ltd Foreign-owned Life insurance 264.8 197.5 16.4 767.4 120.1 PVI JSC State-owned Non-life insurance 210.7 186.2 25.2 732.5 300.2 AIA Vietnam Ltd Foreign-owned Non-life insurance 202.5 126.9 8.1 442.9 65.3 Bao Minh JSC State-owned Non-life insurance 120.1 46.9 8.0 225.6 95.6 PTI JSC Private Non-life insurance 111.9 81.4 4.8 217.5 8.1 Page 8
  9. 9. • Registered name: Bao Viet Group • Head office: Bao Viet building, Hoan Kiem, Ha Noi • Establishment Year: 1965 • Principal businesses: Established in 1965 as Vietnam Insurance Company, Bao Viet is now the largest insurance corporation in Vietnam regarding total premiums with the strength of long historical development. The Company went listed on HOSE since 2009. Currently, Bao Viet’s charter capital is US$299.3mn. Along with insurance activities, Bao Viet established other subsidiaries operating in banking, fund management, securities. The company partnered with 2 strategic investors including Sumitomo Life and HSBC Insurance. COMPANY PROFILING Figure 10: Bao Viet’s Net Premiums (US$mn), 2014-2017 FINANCIAL PERFORMANCE COMPANY POSITION Figure 11: Market Share of Bao Viet regarding total insurance premiums (both life and non-life), 2014 - 2017 Page 9 Source: StoxPlus Source: StoxPlus Key Players’ Profile – Bao Viet Group - 160.0 320.0 480.0 640.0 800.0 2014 2015 2016 2017 Life Non-life 0.0% 20.0% 40.0% 60.0% 80.0% 100.0% 2014 2015 2016 2017 Other insurers Bao Viet • Products: Bao Viet owns 2 insurance companies with products as follows • Bao Viet Life: Life insurance products including personal and family for individuals, families and businesses • Bao Viet Insurance: Non-life insurance products including car, healthcare, property insurance, etc., • Sale channels: 200 branches, 700 offices and 170,000 consultants/agents in 63 provinces • Bancassurance partnerships: Bao Viet currently partners with Orient Commercial Bank and Shinhan Bank PRODUCTS AND SALE CHANNELS
  10. 10. Source: StoxPlus • Registered name: Dai-ichi Life Insurance Company of Vietnam, Ltd • Head office: Dai-ich Life building, Phu Nhuan, HCMC • Establishment Year: 2007 • Principal businesses: Established in 2007, Dai-ichi Life Vietnam is the first Japanese insurance company in Vietnam. After more than 11 years, the company’s total premiums has increased twenty times and became a leading life insurance company with more than 17% market share regarding premiums. The company’s current charter capital is US$261.6mn. COMPANY PROFILING Figure 12: Dai-Ichi Life Vietnam’s Net Premiums (US$mn), 2014-2017 FINANCIAL PERFORMANCE COMPANY POSITION PRODUCTS AND SALE CHANNELS Figure 13: Market share of Dai-ichi Life Vietnam regarding premiums in life insurance market, 2014 - 2017 0.0 70.0 140.0 210.0 280.0 350.0 2014 2015 2016 2017 Source: StoxPlus Page 10 Key Players’ Profile – Dai-ichi Life Vietnam 0.0% 20.0% 40.0% 60.0% 80.0% 100.0% 2014 2015 2016 2017 Other life insurers Dai-ichi Life • Products: Dai-ich Life focuses on life insurance products including life insurance and add-ons to insure against cancer, acidents, etc. • Sale channels: 275 offices and 8,000 consultants/agents in 63 provinces • Bancassurance partnerships: Dai-ichi Life is working with VPBank, SHBank and Sacombank in providing insurance products to customers.
  11. 11. Source: StoxPlus • Registered name: Post and Telecommunication Joint Stock Insurance Corporation; • Head office: HAREC Building, Ba Dinh, Hanoi • Establishment Year: 1998 • Principal businesses: PTI has three main shareholders, namely South Korea-based Dongbu Insurance (37.32%), Vietnam Post Corp (22%) and Vndirect Securities (22%). The company went listed on HNX in March 2011. PTI’s current charter capital is US$35.4mn. COMPANY PROFILING Figure 14: PTI’s Net Premiums (US$mn), 2014-2017 FINANCIAL PERFORMANCE COMPANY POSITION Figure 15: Market share of PTI regarding premiums in non-life insurance market, 2014 - 2017 Source: StoxPlus Page 11 • Products: PTI provides non-insurance products including vehicle, healthcare, property and marine insurance. The company is leading in the equipment insurance sector • Sale channels: PTI has 47 subsidiaries and takes advantage from the broad network of 10,800 post offices in 63 provinces • Bancassurance partnerships: PTI is currently working with Lien Viet Post Bank in serving its customers 0.0% 20.0% 40.0% 60.0% 80.0% 100.0% 2014 2015 2016 2017 Other non-life insurers PTI - 30.0 60.0 90.0 120.0 150.0 2014 2015 2016 2017 PRODUCTS AND SALE CHANNELS Key Players’ Profile – PTI
  12. 12. Table of Contents No Contents Page 1 Vietnam Insurance Market 3 - 11 1.1 Market Structure & Description 3 1.2 Size & Segmentation 4 1.3 Competition Dynamics 5 1.4 Key drivers 6 1.5 Market Prospects 7 1.6 Financial Indicators 8 1.7 Key players’ profiles 9 - 11 2 StoxPlus Introduction 12 – 22
  13. 13. Page 13 Overview • Date of incorporation: March 11, 2008; • Legal representative: Mr. Nguyen Quang Thuan • Number of staff: 80 (as of April 2018) including Data Analysts, Market Analysts, IT Engineers and Product Developers. • Charter capital: VND24 billion (US$1.1 million); Shareholders: NIKKEI: 17.55%; QUICK: 17.55%; Management and other: 64.9%; • Two offices: Hanoi Head Office and HCMC Branch StoxPlus is a pioneer and a Vietnam’s leader in financial and business information services since 2008 Leveraging on our financial and corporate database we provide, on the order basis, research services by our professional team with local insights and international experience: • Industry Report • Customized research • Commercial Due Diligence • Market Entry Consulting • Business matching and Support We offer below products leveraging on our comprehensive financial database: • FiinPro Platform: financial database for professionals covering equity, industry and economic data and analytic tools • FiinTrade Platform: the first comprehensive information platform for trading into Vietnamese stocks • Securities Datafeed: via API or XML StoxPlus Joint Stock Company We offer below products on-the-shelf and by order basis by leveraging on an aggregated source of more than 1 mil+ Vietnamese companies: • Company Report: from basic profile, factsheet, credit report to comprehensive research reports. Financial Information Research & Consulting Business Information
  14. 14. Page 14 Board of Directors and Management Our Management have extensive and diverse experiences in information, technologies & related services Thuan Nguyen, FCCA Chairman and CEO Co-founder of StoxPlus previously working as an investment manager of Vietnam Holding Asset Management Ltd and manager at PwC Vietnam & Australia Hieu Nguyen, MBA Vice Chairman Co-founder of StoxPlus previously working as a specialist at the Department for International Development of UK (DFID) in Vietnam. and Consulting Manager at PwC Vietnam Yoichi Noor Iwamoto Board Member Representative of NIKKEI Inc. at StoxPlus. He is currently Managing Director of NIKKEI CHINA (Hong Kong) Ltd. Chiharu Kawai Board Member Representative from QUICK Corp at StoxPlus. He is currently General Manager of Global Business Department at QUICK Corp. Bolat Duisenov Board Member CEO of Kusto Group Vietnam – a private equity fund with AUM of US$300M operating in Vietnam. Huy Mac, CFA, FCCA Board Member A well-known financier with Lehman Brothers and KPMG. Recently he was CEO of KB Securities (Vietnam) and ex-DCEO of MB Securities. Dong Le, CFA Director, BiinForm Previously Senior Investment Manager at BIDV-Vietnam Partners Investment Management and audit manager at Deloitte Vietnam Trang Truong, MBA Managing Director, FiinForm Managing Financial Information Unit of StoxPlus and lead business analyst for innovative product development at StoxPlus Tung Do CTO Oversight technology and product development at StoxPlus. Previously various managerial position at IT Outsourcing firms including CMC and EKGIS
  15. 15. Page 15 Research and Consulting Services • Leveraging on industry and corporate database, we offer insightful industry reports for Vietnam. • Our Analyst team cover around 20 key sectors of Vietnam and offering reports ready to use in the portal or in an order basis Industry Report A selection of sectors we cover: Consumer Finance Cement PET Packaging Healthcare Services Banking SOEsLogistics Flexible Packaging Fertilizer Food & Beverage
  16. 16. Page 16 Our advantages in database business make us differentiated from other international vendors Research and Consulting Services VCCI Trade Associations StoxPlus Data Exchanges Self–contribution General Statistics Office Credit Information Centre Stock Exchanges Ministries (MOF, MOIT) Banks Chambers of Commerce Local Market Insights Biinform Database Data Cleaning up and Validation • Database of~1 million businesses registered in Vietnam • Company profiles, Ownership and financial data • All types of enterprises: JSC, LTD, FDI, SOE … • All key industries of Vietnam
  17. 17. A Global Standard: International Corporations Client CONSUMER FINANCE CEMENT OTHERS Research and Consulting Services
  18. 18. Page 18 Research and Consulting Services • When the information standard reports is not sufficient nor available, we customize our report to specific requirements by clients plus value added services including presentation, company visits, or business matching. • The scope is more in-depth research tailored to clients’ specific segments of interest with insights input by industry experts. We have a team of seasoned and experienced consultants for customized research assignments and market entry consulting projects. We provide comprehensive analysis and local insights to our clients at quality standards of the world’s prestige advisory firms Market Research • We support investors to explore investment opportunities and define market entry strategies into Vietnam. • Our market entry services range from market due diligence, partner screening, to business set-up. We support clients who are penetrating into Vietnam by either M&A, Equity Investments, Foreign Direct Investments or simply business alliance with domestic enterprises. • Actionable recommendation for clients’ entry strategies, including advisory on all stages: • Market assessment • Business Intelligence • Investment Screening • Trade Connection Market-entry consulting
  19. 19. Page 19 Research and Consulting Services We differentiate our services by leveraging on our Corporate Database; Industry Database and Local Market Expertise with down on-the-ground surveys and a network of industry experts Local Market Insights Biinform Database International Experience RESEARCH SPECIALISATION SURVEY/IN-DEPTH INTERVIEWS WITH LOCAL INSIGHTS NETWORK OF INDUSTRY EXPERTS COMBINATION OF TOP DOWN AND BOTTOM UP APPROACH • Professional teams with experience in market research/due diligence for water & utility • Track records with prestige customers (both fund and industry players) • Most updated industry database (incl. water sector) We put strong focus on developing network of experts who are C-level personnel in the industry. This expert network will be fully utilized for this project. Gaining market intelligence via in-depth interviews with: • Market players • Industry experts • End-use sector players • Policy-makers The advantage of understanding appropriate approaches to generate insights is leveraged. A thorough approach for the project is applied. Demand estimation from end-use industry and industry landscape from industry players will be both included. • Combination of hard data leveraging Biinform database and local insight (track record, expertise & network) • Database of all Vietnam Water Companies (production data such capacity, key operational indicators)
  20. 20. Research and Consulting Services We have a great track record in supporting large local and foreign clients from Day 1 when they first come into Vietnam Page 20 JAPAN FINANCIAL SERVICES OTHER INDUSTRIES KOREA WESTERN COUNTRIES OTHERS
  21. 21. Research and Consulting Services We are proudly making contribution to capital and trade flows within Vietnam and between Vietnam and the World via our product and services; and also via various conferences and industry seminars providing thought leadership about Vietnam market Speaking at Cemtech Asia 2015, 2016, 2017 Annual Consumer Finance Conference, co-host with SBV 2016, 2017 Annual Foreign Investor Conference, co-host with HOSE M&A Seminar, co-host with Singapore Business Group, 2017 SME Financing Conference, 2017 Trade Risk management Conference, co-host with CIC, 2017 FiinPro Talk Series (quarterly) Vietnam Renewable Energy Conference, co- host with Eurocham, 2018 Page 21
  22. 22. Contact us at StoxPlus Nguyen Thi Huyen Trang Senior Associate, Client Service Advisor t: +84 (28) 3933 3586 e: Head Office 5th Floor, Anh Minh Building 36 Hoang Cau Street Hanoi, Vietnam + 84 (24) 3562 6962 Ho Chi Minh City Branch 3rd Floor, Profomilk Plaza Bldg 51-53 Vo Van Tan, District 3 Ho Chi Minh City, Vietnam + 84 (28) 3933 3586 For Financial Information Services For Business Information Services For Research and Consulting Services Le Xuan Dong, CFA Director, Research and Consulting t: +84 (24) 3562 6962 (ext. 110) e: Nguyen Anh Tuyet Manager, Client Service Advisor t: +84 (28) 3933 3585 (ext. 208) e: