Hanoi: Global credit rating agency, AM Best is maintaining its stable outlook on Vietnam’s non-life insurance segment, supported by structural economic advantages and strong demand across core insurance lines.
According to BERNAMA News Agency, AM Best’s latest market segment report titled ‘Market Segment Outlook: Vietnam Non-Life Insurance’ highlights significant growth in the country’s non-life insurance sector, particularly in gross written premiums in 2024. This growth is primarily driven by health and personal accident insurance, fueled by rising healthcare costs, increasing consumer awareness, and the broader use of digital distribution platforms. Additionally, growth in property and engineering insurance, the second-largest non-life segment, contributed to the market’s expansion.
Vietnam’s economic and regulatory environment continues to support the insurance sector’s development. The country’s real gross domestic product grew by 7.1 percent in 2024. However, AM Best cautioned that global trade uncertainties and economic slowdowns among key trading partners might impact export-driven commercial insurance demand. Despite expectations of moderating growth due to softening external demand, structural advantages such as Vietnam’s competitive labor costs and broad participation in global trade agreements continue to support insurance market prospects, said AM Best senior financial analyst, Ken Lau.
Regulatory improvements are also influencing the sector, with a new decree on compulsory fire and explosion insurance expected to enhance premium adequacy. The ongoing transition to a risk-based capital regime, supported by quantitative impact studies and mandatory in-house actuary appointments, is further strengthening insurers’ risk management frameworks.
However, AM Best flagged several moderating factors, including subdued investment returns amid a prolonged low-interest rate environment and higher reinsurance costs following 2024’s Typhoon Yagi. AM Best associate director, analytics, Chris Lim noted that Tropical Storm Wipha, which struck Northern Vietnam in July 2025, may influence reinsurers’ appetite for catastrophe risk in future renewals.
Lau is scheduled to present AM Best’s outlook at the Vietnam Insurance Summit on Aug 1 in Quy Nhon. The event, hosted at the Hotel Anya Premier, will also discuss regulatory changes, insurance demand trends, and competitive dynamics. AM Best is a diamond sponsor of the summit.