After posting an impressive growth in its premium sales last year, home-grown Sovannaphum Life Assurance Plc. is upbeat about its growth prospects this year as it could even double 2018’s sales figures.
“We have done well. We were awarded as the fastest growing life insurance company in 2018. In 2018 itself our new business market was 10 per cent compared to one per cent in the previous year. It is a big jump. This market share has further grown more than 17 per cent in Q1 [first quarter] 2019,” Sovannaphum Life CEO Tan Jiak Hiang told The Post.
Sovannaphum Life, which is a joint venture company between Canadia Investment Holding PLC., the holding Company of Canadia Bank, and Thailand’s Muang Thai Life Assurance PCL, has been operating in the Kingdom for over three years.
The once nascent Cambodia’s life insurance sector is now flourishing, largely buoyed by the Kingdom’s steady economic growth averaging seven per cent annually, rising middle class, a young population and more importantly the growing awareness on the importance of life insurance among the public.
But the penetration level remains low. Only about 400,000 people of the 16 million population are currently insured. Life insurance entered the domestic market only in 2012.
According to the Insurance Association of Cambodia, sales of life insurance grew 50.6 per cent compared to general insurance with 15 per cent growth.
“The total gross premium of the insurance industry rose 30 per cent in 2018 largely driven by life insurance segment. Gross premium was valued at $196.4 million last year, compared to $151.6 million in 2017.
“Life insurance is relatively new, only about seven years now but the industry is growing aggressively. One and a half years ago there were only seven [players] but now there are 10 or 11 [life insurance companies]. When more companies come into this market, more and more people are educating the general public on insurance. So the general awareness is getting better and more people understand the importance of insurance business,” added Tan.
Tan, a Singaporean veteran with 30 years expertise in life insurance sector, says Cambodia has great potential for insurance companies as a bulk of the population is uninsured.
“[According] to 2018 insurance statistics, the industry new policies issued almost doubled, [a] 92 per cent growth compared to 2017. It is a good growth rate, now people are more aware and people are accepting life insurance.
“Life insurance penetration rate is less than one per cent over GDP [gross domestic product] compared to Malaysia’s four or five [penetration rate] and Singapore’s eight. After so many years of business growth these countries achieved these rates only now but look at this country [Cambodia], it is already 0.2 per cent. There is a big gap and there is lot of potential,” added Tan
Sovannaphum Life Assurance offers a range of products loan protection, education saving plan, flexi saving and life solutions (covers critical illness costs and other life insurance benefits).
“The credit life and education saving are our key selling products. These products meet the Cambodian customers’ needs.
“Cambodian people are concerned of their children’s education and protecting their collaterals when they take loan from financial institutions.
“We are enjoying expansion growth, in line with the life insurance market in Cambodia,” he added.