Staff at an insurance company checks a car for compensation. Experts forecast the competition in the motor vehicle insurance segment will become fiercer. Photo tinnhanhchungkhoan.vn

HÀ NỘI — Việt Nam’s non-life insurance market has continued to attract foreign investors in the first months of this year.

Two domestic insurance companies, Vietnam National Aviation Insurance Joint Stock Corporation (VNI) and Military Insurance Corporation (MIC), welcomed new capital from foreign investors in the first quarter of 2023.

PYN Elite Fund, an investment fund from Finland, has announced it has bought 500,000 shares of MIC, raising its ownership rate from 4.99 per cent to 5.29 per cent.

After this transaction, PYN Elite Fund officially became the second largest shareholder in MIC, along with the parent company Military Commercial Joint Stock Bank (MBBank), which holds 68.4 per cent of MIC’s stake.

PYN Elite Fund, formerly known as Mutual Fund Elite, was established in early 1999 by PYN Fund Management (Finland). This is an investment fund targeting Asian markets.

MIC is currently among the top companies with a charter capital of VNĐ1.3 trillion with nearly 2,000 employees. In a development strategy in the 2020-25 period, MIC set the ambition to be the Top 3 leading non-life insurance companies in Việt Nam by 2025.

Previously, in February 2023, DB Insurance officially became the parent company of VNI with an ownership rate of 75 per cent after signing a contract to receive share transfers from a group of shareholders, including 19 individual investors and one institutional investor in VNI.

DB Insurance has been present in the Vietnamese insurance market for more than ten years. In addition to VNI, this large Korean group has also invested in Post and Telecommunications Joint Stock Insurance Corporation (PTI) since 2015. It is currently a major shareholder of PTI with an ownership of 37 per cent of the capital.

One of DB Insurance’s strengths is motor vehicle insurance and the fact that after becoming a major shareholder of PTI, this shareholder has focused on investing in PTI’s retail segment of motor vehicle insurance, helping the insurer continuously maintain the number one market share in the motor vehicle insurance segment in Việt Nam.

Meanwhile, VNI is also one of the Top 10 companies with the largest market share in Việt Nam’s non-life insurance market in 2022, the Top 2 companies with the highest revenue in compulsory auto civil liability insurance, and the Top 3 companies with the highest revenue in motor vehicle insurance. Therefore, the strategy to develop VNI shortly after DB Insurance becomes the controlling shareholder is a question of interest.

In addition to the above two cases, the market is also waiting for new moves in the State Capital Investment Corporation (SCIC) disbursement roadmap in Bảo Minh Insurance, whose personnel structure has changed a lot in recent years.

Experts said with new movements in the market, the competition in the motor vehicle insurance segment would become fiercer.

Non-life insurance still has a certain attraction to foreign capital flows though the profits of this segment mostly declined last year, and the market is not as positive as before the pandemic. However, for investors interested in the non-life insurance market in Việt Nam, the potential remains huge because of the low insurance penetration. — VNS