Vietnam’s insurance industry is experiencing a split trajectory across its life and general insurance segments, with the latter poised for growth while the former is projected to face another year of contraction before potential recovery.
According to research by GlobalData, the general insurance market in Vietnam is forecast to grow at a compound annual growth rate (CAGR) of 7% between 2025 and 2029.
Gross written premiums (GWP) are expected to rise from VND80 trillion (approximately US$3.2 billion) in 2025 to VND104.8 trillion (US$3.9 billion) by the end of the period.
Driving this growth are a mix of regulatory changes, increased health awareness, and rising demand for protection against natural disasters and property-related risks.
Health-related lines, in particular, are expected to maintain the largest market share, comprising 32% of total general insurance premiums in 2025.
Technology upgrades under the amended health insurance law, effective from July 2025, are anticipated to streamline medical processing and reduce fraudulent claims.
Swarup Kumar Sahoo, senior insurance analyst at GlobalData, said these reforms are expected to improve claims efficiency and insurer profitability.
Property insurance is projected to hold the second-largest share of general insurance premiums at 30.9% in 2025. Growth in this line is linked to the increasing frequency of natural disasters, including fires and typhoons. Official data recorded nearly 4,000 fire incidents in the year leading up to September 2024, causing over VND296 billion (US$1.2 billion) in damages.
Motor insurance is also on the rebound following a decline in 2023. The segment is expected to contribute 23.5% of total premiums in 2025, driven by recovering vehicle sales and regulatory mandates for coverage. November 2024 saw a 58% year-on-year increase in vehicle sales, according to the Vietnam Automobile Manufacturers’ Association.
The ongoing shift toward electric vehicles (EVs) has prompted insurers to develop specialised products, including battery coverage and comprehensive EV protection, in response to government policies targeting full EV transition by 2050.
In contrast, Vietnam’s life insurance sector is projected to post another annual decline in 2025, continuing a downward trend that began in 2023.
GlobalData estimates a 1.3% drop in life insurance GWP to VND146.1 trillion (US$6 billion) in 2025, following declines of 12% in 2023 and 5.7% in 2024.
The slump has been linked to decreased consumer trust following concerns over bancassurance sales practices. These include issues such as policy misrepresentation and the perception that insurance was being sold as a requirement for bank loans.
Policy cancellations have increased, with active policies declining by 7.5% in 2023 and an estimated 3.7% in 2024. Life insurance penetration has dropped from 1.9% in 2022 to a projected 1.3% in 2024.
To restore market integrity, the government implemented amendments to the Insurance Business Law in November 2023, which restrict insurance sales within 60 days of loan disbursement and penalise non-compliant institutions.
Looking forward, the sector is forecast to return to growth in 2026, supported by rising incomes, demographic shifts, and new product development. A CAGR of 3.2% is anticipated from 2025 to 2029, taking the market to VND165.4 trillion (US$6.4 billion) by the end of the decade.
