Thursday, Jun 4, 2020
International Finance
Insurance

Competition has improved life insurance sector in Vietnam

And at the end of 2016, Manulife Vietnam's growth was higher than other insurance companies in the industry

Manulife is the first 100% foreign-owned life insurance company in Vietnam and also the first life insurer earning profit in this market. Manulife is present in 7 countries in Southeast Asia and among them, Vietnam is one of the largest markets and has the best growth rate.

Vietnam – great potential for life insurance sector
Vietnam is one of the world’s most dynamic and rapidly expanding insurance markets, with huge growth potential for life insurers. In the financial sector, Vietnam’s life insurance industry has observed substantial growth recently. The participation of various international financial giants has positively improved the life insurance industry on the basis of fair competition.

In the insurance industry, Vietnam is one of the most important markets given its high population and low insurance penetration rate at around 5-6 per cent. Meanwhile, public awareness of life insurance is being enhanced with new clients seeking insurance products as financial solutions for themselves and their families. Moreover, there is a rise in the volume of middle class individuals. These factors demonstrate a great opportunity for Vietnam’s life insurance industry.

Vietnam has a young but aging population, so this is a great opportunity for insurance companies to apply the experience of deploying retirement products in other markets previously effectively in this market.

Besides, opportunities for development in the Vietnamese market are huge. The middle class is growing rapidly, which means that more people will be willing to use part of their income to invest in retirement or financial protection solutions, such as life insurance.

In Manulife Vietnam, after just a short span of time, bancassurance has become a significant distribution channel with remarkable contribution to the company’s business. Today, the channel contributes nearly 25% of the overall company production, which has quadrupled over the last few years

In addition, aging populations will increasingly demand retirement or health and wellness solutions. This trend has significant impact on the life insurance industry not only in Vietnam but also in the Asia-Pacific region.

That’s also the reason why insurers have achieved impressive business results in Vietnam. For example, by the end of 2016, Manulife Vietnam’s growth was higher than other insurance companies in the industry, reaching more than 50% in two consecutive years. Manulife’s agents doubled. Manulife is currently the No. 1 insurer for bancassurance.

In addition, the company is always trying to improve the service, bringing customers more new and convenient transaction utilities. Manulife Vietnam is also considered one of the leading insurance companies in applying digital technology to improve service quality.

Customer centricity – the key to be a trusted partner

It can be said that the strategy of ‘Customer centricity’ is considered as the ‘guideline’ for the business of Manulife Vietnam. The company’s strategy is to always put itself in the customer’s shoes to visualise how to come up with the best products and services.

As part of its ‘Customer Centricity’ strategy, Manulife Vietnam has undertaken a number of activities to enhance the customer experience, from diversifying sales channels to expanding the office network across the country and launching many new products. At present, Manulife Vietnam has 57 offices spread across 41 provinces in Vietnam.

In September 2017, Manulife introduced the ‘Net Promoter System’ (NPSystem) at the hotline. This system will consolidate the data, analyse, solve the causes to optimise the customer experience, helping Manulife move forward.

Manulife Vietnam continues to have one of the biggest MDRT (Million Dollar Round Table) members in the life insurance industry (MDRT is an international standard of excellence in life insurance and financial services for agents)

In addition, Manulife also focuses on changing the service to shorten the transaction time, bringing more benefits to customers. In the future, Manulife will continue to invest in internal resources, improve the quality of customer service in a professional way of agents.

Bancassurance

Thanks to Vietnam’s populous market, which is supported by a high-growth economy, the country is seeing a surge in the middle class, leading to an increase in demand for banking and financial services in general and the huge potential for bancassurance in particular.

Manulife continues to work with a limited number of bank partners, which includes leading joint stock banks and international banks. In 2015, Manulife Vietnam signed its first exclusive bancassurance partnership with Saigon Commercial Bank (SCB), consolidating its market leadership.

And lately, Techcombank and Manulife Vietnam have sealed an exclusive 15-year bancassurance agreement, the first partnership converting from non-exclusive to exclusive in Vietnam after four years of cooperation.

The cooperation will enable Manulife Vietnam to distribute life insurance solutions to all Techcombank customers with the current base of over 1.4 million retail customers and future ones, targeting insurance premiums collected over the next five years to be over VND10 trillion. This new partnership combines Techcombank’s extensive banking network of over 300 branches and Manulife Vietnam’s insurance expertise to give customers one-stop financial centres for both banking and insurance solutions in Vietnam.

With the building blocks now fairly in place, bancassurance for Manulife Vietnam is poised to flourish at a rapid pace.  To consolidate the market leadership position and accelerate growth, Manulife will continue investing and developing the channel further via some key initiatives, such as: customer-centric integration, digitalisation and automation of business processes, simplification of service delivery platforms, data analytics for customer profiling and offering customised solutions as well as human resource development programs to nurture talent.

Human resource – the most valuable asset

In Manulife, agents are still the main and successful distribution channel in the life insurance industry; the other channels are bancassurance, direct marketing, tele-marketing and micro-insurance. Manulife has a strong and professional force of over 26,000 agents.

This is part of what motivates Manulife to continuously invest, improve, and implement comprehensive training programmes for the development of agents. The Centre for Professional Development (CPD) was launched in 2015 as a ‘Centre of Expertise’ in Manulife Vietnam’s Agency Training.

The CPD sets a new benchmark for providing our Agents and Managers with professional training focused on practical, proven methods and systems, and relationship-building techniques to improve our effectiveness with prospects and customers. Moreover, in Manulife, fair compensation is also an important factor in motivating agents to strive for superior business results. These are the basics that help agents succeed in their career and achieve what they aim for.

In terms of internal human resource, in the last few years, Manulife Vietnam has implemented a number of employee benefit programmes, which include The Voluntary Pension Plan – Manulife is one of the first companies launching such a programme for all its employees; and The Emergency Loan Programme to cater to the emergency financial needs of its employees. The leaders in this organisation believe that such benefits offer our employees the motivation and confidence to pursue a rewarding career with Manulife Vietnam.

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