Industry intelligence insurance

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Industry intelligence insurance

  1. 1. IMAS Communication INDUSTRY INTELLIGENCE Insurance Oct 2013
  2. 2. Insurance Market Overview 2
  3. 3. Market Structure • Total: About 58 Insurance Companies (in 2012) No. of Insurance Companies 60 57 50 40 49 50 53 27 10 0 28 29 11 11 10 12 11 29 29 14 12 14 12 2 2 2011 2012 22 9 8 1 2007 • About 11 foreign-invested non-life insurers out of a total of 29. • Foreign invested insurers make up 14 of the 15 life insurers, clearly dominating the market. 40 30 20 57 10 1 2008 1 2009 1 2010 Total Non-life Insurance Re-insurance Life Insurance • Regarding to brokerage services, 7 domestic and 5 foreign-invested companies (foreign firms making up more than 80% of the market for brokerage services) • Only 2 domestic Vietnamese reinsurance companies (PetroVietnam Reinsurance, Vietnam National Reinsurance Corporation) Insurance Broker 3
  4. 4. Market Growth Market size (Million VND) 60,000 140,000 114,663 50,000 99,330 10,277 100,000 10,433 40,000 84,977 71,831 30,000 6,623 8,296 18,397 7,228 57,543 6,799 20,000 120,000 106,246 15,998 60,000 13,772 11,839 9,437 8,213 10,948 13,754 17,070 20,554 22,849 0 2008 2009 • Market growth in all segments, but the growth rate is slow down. Market Growth (%) 25 20,000 0 2007 • Total Revenue increased 9,66% (compared with 2011) 40,000 10,307 10,000 80,000 • In 2012, Insurance Market continued maintaining the growth rate. 2010 2011 2012 Non-life Insurance Life Insurance Investment Revenue Total Market Asset 20 15 10 5 0 2011 Non-life Insurance 2012 Life Insurance All Market 4
  5. 5. Life Insurance Market 5
  6. 6. Life Insurance Activities Growth of Life Insurance (%) 60 52.89 50 45.81 40 34.5 30 20.08 23.13 19.9 22.42 20 10 • Life insurance grows from 2008 to 2012 37.25 19.15 13 13.04 16.57 12.05 8.66 • From 2009, growth rate has been slow down 0 2008 -10 2009 2010 2011 2012 -12.5 -20 No. Of Contract Amount of Insurance Insurance Fee 6
  7. 7. Life Insurance Line of Business Insurance Premium Structure (2012) (%) Insurance Indemnity Structure (2012) (%) [Structure of the amount that insureds pay for their insurances] [Structure of the amount that insurers pay the insureds] 0.24 3.65 0.25 19.37 39.7 53.68 55.96 26.69 0.45 0.01 Whole Life Term Life Endowment Annuity Investment Linked Whole Life Term Life Endowment Annuity Investment Linked 7
  8. 8. Life Insurance Market Share Insurance Premium Revenue Market Share (2012) (%) Insurance Premium Market Share (2012) [Market share based on Financial cost of obtaining an insurance cover, paid as a lump sum or in installments during the duration of the policy] [Market share based on revenues that an insurer receives as premiums paid by its customers for insurance products] 3.39 8.04 8.31 5.52 28.27 24.09 11.11 7.06 8.44 11.73 9.06 25.82 35.45 13.17 Bảo Việt Prudential Manulife AIA Ace Life Dai-ichi Others Bảo Việt Prudential Manulife AIA Ace Life Dai-ichi Others 8
  9. 9. Non-life Insurance Market 9
  10. 10. Non-life Insurance Business Business Insurance Premium Revenue (million VND) [Financial cost of obtaining an insurance cover, paid as a lump sum or in installments during the duration of the policy in each business of insurance] 5,732,619 Health 3,153,052 1,915,596 1,788,035 Property All Risks 820,434 607,850 Aviation 6,257,486 6,095,377 Motor Vehicle 1,565,690 1,242,867 Fire and Allied Perils 1,787,947 1,812,518 Marine hull 526,822 455,053 General Liability 49,370 26,312 Credit and Financial Risks 94,980 64,889 Business Interruption 269,948 9,775 Agricultural 0 1,000,000 2,000,000 2012 3,000,000 2011 4,000,000 5,000,000 6,000,000 7,000,000 10
  11. 11. Non-life Insurance Business Insurance Premium Revenue Struture (%) [Structure of revenues that an insurer receives as premiums paid by its customers for insurance product] 0.42 0.22 2.31 16.75 in 2012 • Some highly grow: Health, Agricultural Insurance 7.83 6.85 25.09 • All businesses insurance grow 27.39 • Health and Motor Vehicle Insurance brought the highest premium revenue • Followed by Marine Hull, Property all Risks, General Liability and Aviation 8.36 3.59 Agricultural Business Interruption Credit and Financial Risks General Liability Marine Hull Fire and Allied Perils Motor Vehicle Aviation Property All Risks Health • Agricultural has a high rate of development, but its premium revenue is still low (compared with others). 11
  12. 12. Non-life Insurance Market Share Insurance Premium Revenue Market Share (%) [Market share based on revenues that an insurer receives as premiums paid by its customers for insurance products] • Bao Viet is also a “Big Player” in Non-life Insurance Market 23.56 37.37 • 37,37% market share left is divided among 25 other Non-life insurance companies 10.04 8.63 Bao Viet Bao Minh 20.39 PVI PJICO Others 12
  13. 13. Reinsurance Market 13
  14. 14. Reinsurance Activities 45,000 Reinsurance Activities (208-2012) Billion VND 40,000 35,000 18,297 30,000 15,932 25,000 • Foreign Reinsurance activities are focused (98,71% of total reinsurance premium) 13,726 20,000 15,000 10,202 11,749 15,176 14,145 12,587 10,000 7,334 5,000 • In 2012, total held back insurance premium increase 11,29% 105 9,366 66 46 3,616 89 2,365 4,483 2008 2009 2010 0 100 6,409 7,674 2011 2012 Net Non-life Reinsurance in Foreign Countries Net Life Reinsurance in Foreign Countries2 Held back Non-life Insurance2 Held back Life Insurance 14
  15. 15. Reinsurance Activities 3,597,948 Health 2,963,881 2,246,762 1,975,000 Property All Risks • With high risk insurance businesses, the companies uses reinsurance service to share the risks. 1,245,855 1,275,344 Marine Cargo 112,109 121,824 Aviation 5,772,188 5,720,730 Motor Vehicle Fire and Allied Perils 870,482 746,020 Marine hull 810,126 886,101 369,246 381,550 General Liability Credit and Financial Risks 11,329 11,136 Business Interruption 41,031 27,043 Agricultural • Motor Vehicle and Health brought the highest Insurance Premium Insurance because of the risk. They need reinsurance to share risk between the insurers. 39,308 6,271 0 1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 7,000,000 Reinsurance Activities (208-2012) Billion VND 2012 2011 15
  16. 16. Challenges and Opportunities 16
  17. 17. Challenges Challenges facing foreign insurance carriers Present regulations do pose some restrictions on foreign carriers, example: -For establishing branches, foreign non-life carriers would have to be operating successfully for the past 10 years, with an asset base of at least $2 billion. - They also cannot have any violations reported against them in their home country for three consecutive years prior to setting up their branches. Online direct sales are also being promoted, although the low awareness about the need for and value of insurance in the country is a hurdle that is slowly being overcome. 17
  18. 18. Opportunities Growth opportunities for foreign insurers The revised Law on Insurance Business will allow carriers to offer investment-linked and retirement-income products. Premiums were projected by Business Monitor International to grow by 71 and 167 percent, respectively, for life and non-life insurance over a five-year period starting in 2010. However, the total premiums written are fairly modest because the market totals are starting from a low base Natural catastrophes in the region have resulted in greater dependence on reinsurance to back up local carriers. Exposure to earthquakes, flooding, and typhoons pose significant risks to Vietnam’s economy, with such disasters having caused severe damage to life and property in the past. The Vietnamese government is also encouraging insurers to introduce alternative products to cover agricultural, export credit, fire, and explosion risks 18
  19. 19. Thanks for reading! Sources: www.mof.gov.vn & www.hoganlovells.com Made by Feniceb HT – Account Executive of IMAS Communication

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