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|Pham Xuan Thai|
The survey aimed to understand and compare consumer risk attitudes across the region, by using the Swiss Re Consumer Appetite for Risk Index and looks into the insurance needs and buying behaviour of respondents. Pham Xuan Thai, Swiss Re’s vice president of client markets, puts VIR in the picture.
Could you highlight some impressive results that relate to Vietnamese consumers?
Vietnam’s generation X and Y of 20 to 40 year olds are the second most risk averse in Asia-Pacific. Across the region, Vietnam has the second highest proportion of 54 per cent of respondents saying their families would or may struggle financially in case of early death, major serious illness or disability.
They already have strong needs for insurance and financial planning, fuelled by worries about medical expenses and risk associated with living longer. Around 60 per cent of the respondents are planning to buy life-health insurance products in the next 12 months.
However, official figures show that the ratio of insured people (only 5 per cent) in Vietnam is still very small compared to other regional markets. Does this mean Vietnamese people are facing the most risk?
A big majority (74 per cent) of respondents in Vietnam are concerned about the amount they have to pay out of their pockets for medical expenses relating to major illness. And 63 per cent are concerned that their medical/health insurance premium will increase beyond their affordability in the future. Both figures are higher than the Asia-Pacific averages of 67 and 58 per cent respectively. Given the significant protection needs, around 60 per cent of respondents in Vietnam are planning to buy life/health insurance products in the next 12 months. This clearly shows that the respondents in Vietnam need more insurance coverage.
What advantages can insurers in Vietnam take on via the survey’s talking figures?
We hope the survey results will help our clients, mostly insurance companies, in their “personal lines” market and product planning while enriching the insurance industry’s ability to anticipate and meet the needs of their customers. For instance, our survey uncovered the following results that can be very useful for insurers. Around 60 per cent are planning to buy life-health insurance products in the next 12 months, fuelled by worry about medical bills, the two key drivers for insurance purchases are getting a serious illness (79 per cent) and the inability to pay for long-term medical expenses (44 per cent).
The survey also shows that an overwhelming majority (91 per cent - the highest in Asia-Pacific) of respondents in Vietnam source financial information through insurance agents and an overwhelming majority of respondents (86 per cent) prefer buying life and health insurance through insurance agents.