Among the new insurance products launched in the early months of 2019, the products of the general affiliate line still dominate. A number of unit linked insurance products are also offered by many insurance companies targeting high-income customers and those who have good financial knowledge.
Business results of the life insurance sector in the first three months of 2019 showed that investment-linked insurance operations accounted for 68.32 percent of the new exploitation fee revenue, followed by mixed insurance that accounted for 14.79 percent, death insurance accounted for 2.87 percent, the remaining main operations (life insurance, periodic insurance, pension insurance and health insurance (main product) accounted for 3.47 percent and supplemental insurance premium accounted for 10.54 percent.
Compared to the same period last year, new operating revenues of investment-linked insurance operations increased by 62.48 percent; mixed insurance operations decreased by 37.46 percent; and death insurance business increased by 1.93 percent.
Although the exploitation results of the first six months of 2019 have not yet been officially announced, the forecast of investment-linked insurance operation will still account for approximately 70 percent of the total revenue of the market.
“The problems in the regulations on agents selling insurance associated units have been removed by the authorities, making it easier for enterprises to deploy and sell this product line”, a security enterprise’s representative shared.
After five years of officially selling the first product under the investment link, recently, Manulife, an insurance company from Canada, continues to market a new product. According to Manulife representative, this investment-linked product is designed based on thorough research on the needs of customers, so the product will be more special than the old-generation investment product with many attached benefits such as medical benefits, disability benefits due to accidents.
“When doing customer surveys to design this product, Manulife Vietnam has received a lot of customer feedback on medical benefits. Therefore, we add this benefit to the increased version,” said Manulife representative.
Before Manulife, in March and May 2019, other insurance companies such as Sunlife or generali introduced to the market the insurance products associated with the new version that integrates more benefits for customers.
“In recent years, investment-linked product lines have played a key role in bringing revenue to all insurance companies. This product line is also easy to sell to all channels such as agents and bancassurance with many different market segments. Meanwhile, the traditional product line is still implemented by insurance enterprises, but mainly for rural customers because this is a simple and understandable product line, “representative of an insurance enterprise recognised.
Along with the continued throne of the investment-linked insurance business, the revenue structure from the channels continues to change, in which the revenue from bancassurance will become a revenue source with very important contributions to life insurance companies at a rate of up to 25 percent of total new fee revenue. In particular, life insurance companies have exclusive partners and big cooperation deals with banks such as Prudential, Manulife, AIA or MB Ageas Life.
“Although not yet developed as some insurance market development, in which the premium revenue coming from bancassurance accounts for 30-40 percent, after a short time, the total premium revenue comes from bancassurance channel in Vietnam market will also reach 25 percent of the total fee revenue,” said a representative of an insurance enterprise.
By the end of June 2019, total life insurance market revenue was estimated at 44.195 trillion dong, up 17 percent (estimated figures of life insurance businesses). The total number of valid contracts at the end of the period (main products) is estimated at 9,499,961 contracts, up 18.6 percent compared to the same period last year. Among them, Top five enterprises are Bao Viet Life, Prudential, Manulife, Dai-ichi Life and AIA.
