It is undeniable that the competition between insurance firms has been increasingly intense. However, according to specialists, opportunities may come from difficulties. For example, non-life insurance firm Cathay Vietnam and life insurance firm Fubon Vietnam have been recently received in-principal approval for operational license from Ministry of Finance. This has made many businesses concerned. However, it is said that this would help the insurance companies improve their services and be able to compete fairly with each other. People would no longer talk about big-small, new-old, or state owned-private insurance companies. The biggest concern would be on how they operate and benefit the customers.

It is clearly proved when non-life insurance firms have taken advantage of the victories with various ambitious plans. For example, Liberty Vietnam (an US insurance firm) has recently increased its charter capital from $20 million to $40 million in March 2010, in order to promote their business activities in Vietnam's market. Bao Viet also set revenue base target from premiums to be up by 15 percent, whereas profit before tax is expected to be 300 billion dong. BIDV Insurance Company (BIC) is targeting 35 percent revenue growth, 23 percent profit growth, and maintaining to be in top 10 for market shares, in top five for return on equity capital ratio. BIC is also optimistic when giving the total revenue target of 540 billion dong for this year, etc.

Not only improving themselves, most insurance firms have successfully accepted by the customers, since the products are designed carefully for the insured's benefit. The original compensation rate in the market currently averages 38.34 percent of the total revenue, although firms have had to extend the policies' conditions, lowered premiums, increase promotional and customer care activities, in order to compete for market shares. Although it is the difficulty for insurance firms, this has been good news to customers, since they increasingly enjoy better services, with more options and pay lower rates than before.

Along with the above moves, various non-life insurance firms have found solutions for their difficulties by different ways. Especially in 2010, the market is expected to have participations of large insurance brands in the world. The competition, hence, will become more intense. Maintaining good services, superior products and competitive prices are challenges for many firms. Liberty Vietnam has quickly offered some unique products to the market, such as insurance policy for trucks, named Liberty TruckCare, following the success of the car insurance products, which has been trusted in the last two years. Those products help the insured to feel secure against the accidental risk, etc. In addition, for Liberty TruckCare, Liberty does not limit the number of accident claims; it only gives liability exclusions. That means Liberty accept more risk when using this method.

Than Nien - August 13, 2010