Vietnam Insurance Market and Technology Overview
The driving factors for future growth in Vietnam’s insurance market include promising demographics, a growing economy, growing middle class, regulation, opening of the market, and changes to the social security system.
In the report Vietnam Insurance Market and Technology Overview, Celent looks at insurance development in Vietnam, including product trends, distribution channels and IT spending.
Vietnam’s insurance market has developed quite quickly. The compound annual growth rate (CAGR) from 2005 to 2011 was 13.6%. Nonlife premiums increased at a CAGR of 19.5% from 2005 to 2011, more than twice the rate of life insurance premiums. In recent years, however, the growth rate has slowed.
The nonlife insurance market in Vietnam is more crowded than the life sector. Life insurance market concentration is higher than non-life market concentration. The top three life insurers account for 71% of the total premium, while the top three non-life insurers account for only 55% of the market.
“The driving factors for future growth in Vietnam’s insurance market include promising demographics, a growing economy, growing middle class, regulation, opening of the market, and changes to the social security system,” says Wenli Yuan, Senior Analyst with Celent’s Asian Financial Services Group and the author of the report, “There are also some shortcomings that might hamper growth, but the government and insurers are seeking solutions to solve the problems.”
The report also discusses the priorities for IT investment and local insurers’ attitude to solution vendors. In regard to IT spending, foreign companies’ IT spending in Vietnam is usually influenced by their regional IT strategy, so this report focuses on IT spending by local insurers.
The development of the insurance market in Vietnam is still in the early stage, so increased market share is the top priority for most insurers. In order to increase market share, some top business drivers for IT spending are introducing multiple product types to target various customer segmentations; building up infrastructure capabilities countrywide; supporting distribution channels; and improving customer satisfaction.
This 26-page report contains 17 figures and three tables.