Non-life insurance market continues to grow

	Investment business of insurance enterprises are managed more strictly
	Insurance market maintains growth momentum
	Improve processes and enhance experience to rebuild trust in life insurance

The non-life insurance market still records positive growth. Photo: ST

A picture of high growth in business

There are still businesses that are experiencing a decline in profits. For example, at Saigon - Hanoi Insurance Corporation (BSH), the consolidated financial report for the first 6 months shows that after-tax profit in the second quarter of 2024 increased by nearly 24% compared to the same period last year, reaching more than VND 52 billion, but due to having to compensate for the loss in the first quarter of 2024, the total profit for the first 6 months decreased by nearly 37% and reached nearly VND 32 billion.

According to a report from the Ministry of Finance, in the first 7 months of 2024, total insurance premium revenue is estimated at VND 126,675 billion, down 2.21% over the same period last year; insurance benefit payments are estimated at VND 49,142 billion, up 25.06% over the same period in 2023, etc. Although the whole sector's revenue decreased slightly, in the non-life insurance sector alone, the figure is quite positive, estimated to increase by 11.23% in the first 6 months of 2024, in contrast to the 9.8% decrease in life insurance.

On the business side, the financial reports for the first 6 months of 2024 of non-life insurance companies all recorded growth in revenue and profit, with some companies even growing at double digits. For example, at PVI Insurance Corporation, total revenue reached VND 12,016 billion, up 65.7%; pre-tax profit reached VND 502 billion, up 42.6% over the same period last year - leading the growth rate in the non-life sector.

Previously, at the end of March 2024, PVI was approved by the Ministry of Finance to increase its charter capital from VND 3,300 billion to VND 3,500 billion. PVI representative said that the increase in charter capital helps improve financial capacity, creating favorable conditions for the process of expanding the network of operations, investing in facilities, technology, diversifying products and services to better meet the increasing needs of customers; at the same time, helping PVI Insurance gradually firmly participate deeply in the international insurance market. In addition, the high growth rate is also thanks to PVI's implementation of many new insurance programs through e-commerce partners along with new products such as auto emergency rescue insurance, supplementary health insurance, etc.

At Military Insurance Corporation (MIC), in the first 6 months of 2024, original insurance revenue reached VND 2,575 billion, up 6.1% over the same period; total profit reached VND 176.5 billion, up 9.5% over the same period last year. Petrolimex Insurance Corporation (PJICO) recorded after-tax profit in the first half of 2024 reaching more than VND 157 billion, up 4.1% over the same period last year; In which, net revenue from insurance business activities reached more than 1,795 billion VND, an increase of 12% over the same period in 2023. Bao Minh Joint Stock Corporation also recorded after-tax profit of more than 150 billion VND, a slight increase of 2% over the same period in 2023, etc.

Optimize sales channels, focusing on digital channels

With positive results in the first half of the year, non-life insurance companies are all aiming to reach their business plans for the whole year of 2024. According to information from the Department of Insurance Management and Supervision (Ministry of Finance), the Vietnamese insurance industry is looking forward to a promising year, with total non-life insurance premium revenue in 2024 estimated at VND 79,687 billion, up 12% over the same period in 2023.

According to experts, the level of competition in the industry is increasing, as many insurance companies enter the market, including both domestic and international enterprises. Therefore, non-life insurance companies must find ways to come up with new strategies and directions on the path of development.

MIC representative said that the Company would continue to diversify and optimize sales channels based on maximizing the ecosystem of MB Group, banks, large corporations, partners, and strategic customers. In particular, it will focus on promoting sales through digital channels through the development of high-tech products, completely digitizing the sales process through digital channels from the stage of searching and screening customers to the stage of compensation and renewal, etc. Similarly at PVI, the Company's leadership said that it would continue to promote the development of e-commerce and brokerage channels; expand international markets to develop the scale of reinsurance revenue; arrange new reinsurance contracts to improve the efficiency of insurance operations.

Moreover, at many non-life insurance companies, the participation of "foreign shareholders" is expected to bring a new breeze for more positive business results. For example, DBI Insurance, a subsidiary of DB Group (Korea), currently holds 75% of charter capital at BSH and Vietnam Aviation Insurance Corporation (VNI) and 35% of charter capital at PVI, thereby not only providing financial resources but also sharing management experience, advanced technology and development strategies. As evidence, in the first 6 months of 2024, VNI recorded original insurance revenue of nearly VND 1,385 billion, an increase of 24.3% over the same period last year and 2 times the overall growth of the whole market, helping VNI's pre-tax profit in the first 6 months of 2024 increase by 161.4% over the same period in 2023.

At BSH, the participation of foreign strategic shareholders is also expected to help the company regain growth momentum, creating leverage to help BSH expand the market while promoting technology development capacity, improving service quality, etc.

In addition, Vietnamese non-life insurance companies are also strengthening cooperation with each other to unite into "strength" to meet high contracts and requirements from customers. In early July 2024, a consortium of insurers, led by Bao Viet Insurance Corporation and PVI, BSH and VNI Companies, signed a cooperation agreement with HBRE Group to provide insurance services for the first and largest offshore wind power project in Vietnam with a total investment of 2.4 billion USD in Vung Tau.