KUALA LUMPUR, Oct 19 (Bernama) -- Vietnam’s non-life market has experienced a high rate of growth in the most recent five-year period and stands in contrast to the subdued growth in many neighboring markets, according to a new A.M. Best report.
The Best’s Market Segment Report -- “Vietnam Non-Life Market: A Growth Story in a Challenging Operating Environment” -- stated that the non-life market in 2017 recorded total direct premium written of approximately VND 41 trillion or USD 1.8 billion.
The non-life market’s growth prospects remain positive given the low penetration rate in Vietnam of 0.8 per cent, a statement said.
While growth in this retail-led market has been strong, underwriting margins have been decreasing rapidly. Operating expenses are high and economies of scale have yet to be realized as the market is still in a developing stage.
Investors including from overseas have been attracted to Vietnam’s non-life market, which is one of the few markets in Asia without restrictions on foreign ownership. The paid-up capital for the top five non-life insurers also has increased 29 per cent since 2013.
It is also reported that Credit Ratings on Vietnam’s non-life insurers are supported by solid risk-adjusted capitalization and overall positive earnings, due to good investment results, the statement said.
A.M. Best is a global rating agency and information provider with a unique focus on the insurance industry. More details on www.ambest.com.
-- BERNAMA
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