Insurers have reported a sharp fall in premiums in recent months after many scandals related to bancassurance have been revealed.
According to the Ministry, the total revenue from insurance premiums in the first nine months of the year decreased by 6.9 percent compared with the same period last year.
The report on socio-economic development in the third quarter and first nine months of 2023 released by the General Statistics Office (GSO) also says insurers are meeting difficulties because of state management agencies’ tighter control over bancassurance.
The move of tightening control over bancassurance has been taken after many individuals and businesses denounced banks for cheating them into taking insurance policies. Individuals said they were receiving wrong information from insurance agents and therefore, making wrong decisions.
Meanwhile, businesses complained that they could not access bank loans if they refused to take the insurance policies issued by the banks.
The total revenue from insurance premiums in the third quarter reached VND52.9 trillion, a decrease of 10.4 percent compared with the same period in 2022. The figure had reached VND165.6 trillion by the end of the third quarter, a decrease of 6.9 percent.
Of these, the revenue of the non-life insurance sector was VND52.2 trillion, up 2.6 percent, and the revenue of life insurance was VND113.4 trillion, down 10.7 percent.
Prior to that, on June 30, the Ministry of Finance (MOF) released a report on the results of the inspections at four life insurance companies, including Prudential, Sun Life, BIDV Metlife, and MB Ageas.
The ministry pointed out a series of violations committed by insurance consultancy agents, requesting insurance companies’ CEOs to put heavy sanctions on the violations and report the results to the watchdog agency.
The most common violations were that 1/ they did not strictly follow the procedures for selling insurance policies 2/ did not ensure the quality of the consultancy on insurance policies 3/ did not collect exact information from clients during the consultancy process and 4/ bank officers did not observe the regulations on using insurance agent codes.
MOF has requested the four life insurers add hundreds of billions of dong to their taxable revenue.
Deputy Minister of Finance Nguyen Duc Chi said at the government’s press conference in early July that his ministry would inspect five insurers (3 life and 2 non-life) this year.
According to GSO, as of September 20, the total means of payment had increased by 4.75 percent over late 2022 (the growth rate of 2.49 percent was reported for the same period last year).
According to the State Bank of Vietnam, by September 15 the total outstanding loans reached VND12.6 quadrillion, up 5.56 percent.
(VietnamNet)