phuocpham
13-03-2009, 04:32 PM
In 2008, most insurance companies saw turnover and
profit increase over the previous year. In particular, profit from
investment activities of insurers witnessed the highest ever growth
rate, according to the Vietnam Insurance Association.
The noteworthy thing is that no insurance company
dared increase their portfolios in securities investments; therefore,
they did not suffer heavy impacts from the falling stock market.
According to Phung Dac Loc, Secretary General of the
Vietnam Insurance Association, the majority of the profit insurers got
in 2008 came from financial investments with their stockholder equity
and capital surplus (the price margin got from share issuances).
Insurers benefited from the State Bank of Vietnam’s
policy on tightening monetary policies, which once pushed bank interest
rates up to very high levels at over 18% per annum, while the average
interest rate was 10-12% last year.
As for non-life insurance companies, profit from
investment activities proved to be a miracle for them, which brought
money in the context of insurance premiums being not high enough to
cover compensations, expenses and provisioning in accordance with the
Ministry of Finance’s regulations.
In 2008, the total non-life insurance premiums of the
market reached nearly VND10,900bil, an increase of 30% over 2007. The
premiums were 21% higher than the target set in the insurance
development strategy for 2010 (the targeted level was VND9tril).
The top five insurers which had high premiums in 2008 were Bao Viet (VND3,305bil), PVI (http://www.vietstock.com.vn/vstfinance/StockDetail.aspx?scode=PVI&q=PVI" style="color: rgb(68, 68, 204); text-decoration: underline;" target="_blank) (VND2,016bil), Bao Minh (VND1,981bil), PJICO (VND1,061bil) and PTI (VND429bil).
The unsatisfactory results in insurance operations
will force insurers to rethink their actions of slashing insurance
premiums to scramble for clients.
Life insurance companies reportedly got the turnover
of VND10,334bil in 2008. The five life insurers which had the highest
turnovers were Prudential VND4,270bil, Bao Viet VND3,425bil,, Manulife
VND1,072bil, AIG VND634bil, Dai-ichi VND585bil.
Economists have warned that in 2009, the global
economic recession will have continuous impacts on Vietnam’s economy.
In the first months of the year, the VN Index and bank interest rates
continued decreasing, and the falls will certainly influence the profit
from investment activities of insurers.
The Vietnam Insurance Association has suggested that
life insurers think of measures to help clients overcome the current
difficulties. Clients may see their incomes decrease due to the
economic recession, and they need help to be able to pay premiums
annually and not stop contracts before maturation.
profit increase over the previous year. In particular, profit from
investment activities of insurers witnessed the highest ever growth
rate, according to the Vietnam Insurance Association.
The noteworthy thing is that no insurance company
dared increase their portfolios in securities investments; therefore,
they did not suffer heavy impacts from the falling stock market.
According to Phung Dac Loc, Secretary General of the
Vietnam Insurance Association, the majority of the profit insurers got
in 2008 came from financial investments with their stockholder equity
and capital surplus (the price margin got from share issuances).
Insurers benefited from the State Bank of Vietnam’s
policy on tightening monetary policies, which once pushed bank interest
rates up to very high levels at over 18% per annum, while the average
interest rate was 10-12% last year.
As for non-life insurance companies, profit from
investment activities proved to be a miracle for them, which brought
money in the context of insurance premiums being not high enough to
cover compensations, expenses and provisioning in accordance with the
Ministry of Finance’s regulations.
In 2008, the total non-life insurance premiums of the
market reached nearly VND10,900bil, an increase of 30% over 2007. The
premiums were 21% higher than the target set in the insurance
development strategy for 2010 (the targeted level was VND9tril).
The top five insurers which had high premiums in 2008 were Bao Viet (VND3,305bil), PVI (http://www.vietstock.com.vn/vstfinance/StockDetail.aspx?scode=PVI&q=PVI" style="color: rgb(68, 68, 204); text-decoration: underline;" target="_blank) (VND2,016bil), Bao Minh (VND1,981bil), PJICO (VND1,061bil) and PTI (VND429bil).
The unsatisfactory results in insurance operations
will force insurers to rethink their actions of slashing insurance
premiums to scramble for clients.
Life insurance companies reportedly got the turnover
of VND10,334bil in 2008. The five life insurers which had the highest
turnovers were Prudential VND4,270bil, Bao Viet VND3,425bil,, Manulife
VND1,072bil, AIG VND634bil, Dai-ichi VND585bil.
Economists have warned that in 2009, the global
economic recession will have continuous impacts on Vietnam’s economy.
In the first months of the year, the VN Index and bank interest rates
continued decreasing, and the falls will certainly influence the profit
from investment activities of insurers.
The Vietnam Insurance Association has suggested that
life insurers think of measures to help clients overcome the current
difficulties. Clients may see their incomes decrease due to the
economic recession, and they need help to be able to pay premiums
annually and not stop contracts before maturation.