The net impact on BIDV Insurance Joint Stock Corporation (BIC) of Typhoon Yagi, which occurred in the third quarter of 2024, is expected to lead to greater volatility in underwriting performance over the near term, says AM Best. Nonetheless, the impact is expected to be mitigated by the company's reinsurance programme.
The estimated insured losses caused last month by Typhoon Yagi has reached at least VND12,811bn ($507m) as of 16 October, according to reports from insurance companies.
The destructive typhoon Yagi caused severe damage to 26 provinces and cities in northern Vietnam, including key economic zones like Hai Phong, Quang Ninh and Hanoi. These areas host significant industries, contributing 25.81% of GDP and 17.27% of Vietnam's export value, according to FiinGroup.
Agricultural insurance will gradually play an important role in Vietnam in which more than 60% of the population live in rural areas and are largely dependent on agricultural production, according to Mr Ngo Trung Dung, Insurance Association of Vietnam (IAV) deputy secretary-general.
In 2023, Vietnamese companies reinsured only VND6tn ($244m) of domestic reinsurance premiums, while they transferred VND22tn of the premiums to foreign reinsurance companies.
Motorcycle liability insurance premiums totalled VND431.8bn ($17.6m) in the first half of 2024, with claims amounting to nearly VND42bn, according to official statistics. This reflects an improved payout rate compared to previous years.
The bulk of losses resulting from Typhoon Yagi claimed on Vietnam insurance companies is expected to be borne by domestic and international reinsurers, according to a new commentary by AM Best.
Insurance companies in Vietnam have received at least VND2.76tn ($112m) in claims to date for damages caused by typhoon Yagi which made landfall in Vietnam on 7 September.
After a tough year in 2023, the business performance of life insurance companies has not yet recovered.
MSIG Asia (MSIG) has announced that it has invested in a major stake in Serenity Health Partners (Serenity), a Singapore-incorporated health solutions provider.