It is time to amend the Law on Insurance Business to help create a safe, transparent, sustainable and efficient insurance market that is close to international practices, National Assembly delegates said.

NA deputies discussed the draft amended law at the second plenary session of the 15th National Assembly (NA) this week.

On the sidelines of the discussion, Vu Trong Kim, a deputy of Nam Dinh Province said the amendment was important, especially in the context that Viet Nam had joined many new-generation free trade agreements such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the Viet Nam-European Union Free Trade Agreement (EVFTA).

“The amendment of regulations on insurance business, which was issued 20 years ago, will contribute to improving competitiveness, helping the insurance market become an important capital provision channel for the economy besides the monetary and stock markets,” Kim said.

Notably, he said, the amended law would encourage more investors to participate in the local insurance market as it supplemented regulations on State management of insurance business activities to create a safer legal corridor.

According to the Ministry of Finance, the draft amended law closely follows seven main contents, aiming at increasing autonomy for insurers in business activities. Management agencies will give priority to supervising and promoting transparency and healthy development of the insurance market.

This draft completes regulations on financial management models for businesses, completes insurance contracts, and ensures the principles of equality, transparency and safety.

It also specifically encourages businesses to use and apply information technology to standardise insurance activities and transactions in the market, as well as supplementing regulations on developing and improving the quality of human resources in this field, and regulations on safety assurance, loss prevention and control, insurance fraud prevention, and improvement of dispute settlement.

According to deputy Nguyen Ngoc Bao from Bac Ninh, the amended law needs to pay more attention to agricultural insurance as it is not clarified in the law.

Agricultural insurance regulations should be clearly defined in the amended law to help develop agriculture, forestry and fishery programmes, Bao said.

In the first eight months of the year, the Vietnamese insurance market still recorded positive growth despite the COVID-19 pandemic. By the end of August, total assets in the insurance market were estimated at nearly VND643.6 trillion (US$28.3 billion), up 22.1 per cent year-on-year, with total premium revenue during the period also rising nearly 17 per cent to more than VND133 trillion.

Viet Nam is high potential for insurance services, but the development pace is still low compared to the region and world. The amended Law on Insurance Business is expected to take effect from 2023. — VNS