Local insurance providers see growth potential in industry

The government is expecting a total of 29 foreign and local life and non-life insurance companies to operate in Myanmar.

So far, four foreign life insurance companies have applied to form joint ventures with local partners while five non-life foreign insurance companies may also form similar partnerships, Daw Sandar Oo, the Chair of Myanmar Insurance Association, said during the Into Myanmar: Insurance Summit 2019 in Yangon yesterday.

“We have received the joint venture proposals and will announce the result of the joint venture companies at the end of July,” said U Thant Zin, Director of Financial Regulatory Department under the Ministry of Planning and Finance (MOPF). Foreign insurers are able to take stakes of up to 35 percent in local insurers.

In Myanmar, insurance penetration stands at just 0.07 percent of GDP, with the market valued at just US$70 million in 2016-17. Non-life insurers contributed to more than 70pc of the market. There are 30 categories of insurance products now being offered, with property insurance representing 80pc of total non-life income, according to Myanmar Insurance Association.

U Myo Min Thu, managing director of AYA Insurance, told The Myanmar Times that the Myanmar life insurance market holds significant growth potential and that is generating high interest among foreign providers.

Of the 29 insurance providers, 17 provide life insurance. These include foreign providers AIA, Chubb Tempest Reinsurance, Dai-ichi Life insurance, Manufacturers Life Insurance and Prudential Life Insurance, which were permitted to operate in Myanmar on April 5.

U Myo Min Thu said that competition in the life insurance market is expected to be robust and will lead to better products and services for consumers, adding that the regulator’s role is important in the development of the fledging market.

He added that prospects for the non-life insurance sector are robust too. “The non-life insurance market will develop further in the next ten years. Now, we are seeing a lot of interest among foreign providers to do joint ventures with local insurers. This will result in growth,” he said.

Source: Myanmar Times

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