Living and working in Vietnam as an expat comes with its own set of adventures, and insurance is a crucial element, be it for travel or health. However, review the year 2023, recent data paints a picture of a shifting landscape where expats and tourists are opting for insurance in Vietnam less frequently.
What Does the Vietnam Insurance Market Resemble in 2023?
When we decipher the numbers the premium revenue of the entire insurance market in 2023 saw a notable decline, standing at an estimated VND 227,100 billion. This marked a decrease of over 8.3% compared to the previous year, signaling evident challenges in the industry.
Facing Challenges Head-On
As we reflect on Q4-2023, the total premium revenue took a dip of nearly 12% compared to the same period in the preceding year. The cumulative fee revenue for the year is estimated at VND 227,100 billion, showcasing a decline of more than 8.3% compared to the previous year. In a recent program, Ms. Ly Thi Thu Thuy, Head of the Life Insurance Management Department, acknowledged the industry’s challenges, noting backward fee revenue for the first time in two decades.
Adapting to the Market Dynamics
Acknowledging the market’s challenges, efforts are being made to enhance the legal framework, urging insurance businesses to evolve their sales channels. The focus is on creating criteria that benefit not only the sellers but also the buyers and society at large. This approach aims to improve the rate of insured individuals and foster a sense of humanity within the industry.
Market Dynamics Beyond Insurance
While the insurance landscape faces its challenges, other financial indicators come into play. The stock market, as of mid-December 2023, experienced an average trading value of over 17,600 billion VND per session, reflecting a 13% decrease from the previous year. The bond market witnessed a similar trend, reaching over 6,100 billion VND per session, down by 20.4%. Despite these fluctuations, the total means of payment increased by more than 10% compared to the previous year.
The Broader Economic Picture
Amidst the intricacies of the insurance market, a broader economic perspective emerges. In 2023, 217,700 businesses entered the market, a 4.5% increase from the previous year, while 172,600 enterprises withdrew, marking a 20.5% rise. The GDP is estimated to increase by 5.05% over the previous year, reaching over 10.22 million billion VND. The GDP per capita is expected to rise to 101.9 million VND/person, reflecting a positive increase.
Looking Ahead to 2024 for Insurance in Vietnam
As we transition to 2024, the forecast for the Vietnam insurance market remains a subject of interest. Navigating the evolving landscape requires a proactive approach from both insurers and the regulatory framework. The industry’s resilience and adaptability will play a pivotal role in shaping the insurance landscape in the coming year.
For further details on the socio-economic situation in Q4 and the entire year 2023, you can find a comprehensive recap here.
