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The life insurer has recently signed business cooperation agreements with Shinhan Bank Vietnam and Shinhan Vietnam Finance Co., Ltd. All three are now under Shinhan Financial Group, a leading conglomerate based in South Korea.
Teaming up with the two companies under the Shinhan Financial Group roof with a wide business network across Vietnam is an important step in Shinhan Life Vietnam’s strategy of diversifying its distribution channels from its inception.
It attaches great significance to the bancassurance business – the distribution channel that currently makes up the second largest proportion of new business for insurance companies in the market – through its deal with Shinhan Bank Vietnam that was launched in late May.
|Kang GewWon, general director of Shinhan Bank Vietnam (left) and Lee Euichul, CEO of Shinhan Life (right) signing the insurance business partnership|
Under the agreement, Shinhan Bank will promote Shinhan Life Vietnam’s products to customers nationwide. The first bancassurance product is Shinhan - Credit Life, which is a term life insurance product that protects borrowers.
Emphasising the importance of diversifying distribution channels as the company's current top priority, Shinhan Life Vietnam CEO Lee Euichul said, “Shinhan Bank has almost 30 years of operating experience and has a business network across the nation. Therefore, we hope that more Shinhan Bank customers can gain access to products from Shinhan Life in the most convenient and fastest way possible.”
Meanwhile, the strategic partnership launched this June by Shinhan Life and Shinhan Finance Vietnam enabled the latter to provide the former’s services and products – starting with Shinhan - Credit – via the finance firm’s distribution channels.
|Oh TaeJoon, general director of Shinhan Life (left) and Shinhan Life Vietnam CEO Lee Euichul at the signing ceremony|
“Our partnership with Shinhan Finance opens up new opportunities in terms of product portfolio, customer resources, and suitable financial services, demonstrating Shinhan Life Vietnam's long-term commitment to the market,” said the insurer’s CEO.
The life insurer also has ambitious plans to build a business model with contactless sales, telemarketing, and digital marketing to ensure its competitive advantage. Euichul said he expects this strategy to help the firm grow significantly.
According to the Ministry of Finance, Vietnam's insurance market continued to maintain strong growth momentum in the first half of the year, in which the life insurance sector was estimated at around $2.9 billion, up 14.5 per cent on-year.
Though this growth is somewhat slower compared to previous years, the market is expected to rally over the rest of 2022. In the long term, the market’s potential continues to be seen as very high due to large numbers of uninsured individuals and rising demand.
The market will also be driven by many factors, such as the amended Law on Insurance Business, forecast increases in GDP per capita to $7,500 by 2030, and the quickly growing middle class.
In addition, insurers are increasingly investing in digital transformation, improving service quality, diversifying products, and expanding distribution channels to best meet customer needs.
With the same thinking, the CEO of Shinhan Life Vietnam said that Vietnamese people increasingly recognise the importance of life insurance.
“We will grab these opportunities to provide suitable financial plans for local customers. Based on this goal, we will continue to focus on developing distribution channels, especially partnerships with other Shinhan Financial Group members,” Euichul added.
His firm introduced two mixed products designed for children to the market this June, namely Shinhan - Tuong Lai and Shinhan - Thanh Tai.
According to experts, the strongest point of the duo is the comprehensive protection solutions that are offered for the whole family, protecting both parents and children against unfortunate risks in life and serving as a financial backup fund when needed. The company said that despite being new, the products have secured real interest from many customers.
With only around six months of operation in the Vietnamese market, Shinhan Life is already seen as a player with strong potential, benefitting from an initial charter capital of more than $100 million, continued expansion of its distribution channels, a diversified product portfolio, and constant efforts to enhance the market’s competitiveness.