Insurance Enterprises: A Sigh of Relief, Yet Profits Remain Elusive

As Vietnam’s leading non-life insurance provider, PVI Insurance (stock code: PVI) reported a 9-month revenue of VND 21,538 billion, a 38.7% increase, surpassing its annual target by 108.4%. Original insurance revenue grew by 10.4%. Pre-tax profit for the period reached VND 1,148 billion, doubling year-on-year and exceeding the annual goal by 145%.

Bao Minh Corporation (stock code: BMI) achieved its annual target in just 9 months, with Q3 pre-tax profit soaring 215.4% to VND 126 billion, and post-tax profit rising 120.3% to VND 113 billion. For the 9-month period, pre-tax profit totaled VND 302 billion, up 37.9%.

This growth was primarily driven by the insurance business segment, which recorded a net profit of VND 91 billion, a stark contrast to the VND 19 billion loss in the same period last year. Cumulatively, BMI’s 9-month pre-tax profit reached VND 302 billion, a 37.9% increase.

Petrolimex Insurance (stock code: PGI) maintained its Q3 pre-tax profit at VND 46 billion, with post-tax profit slightly increasing to VND 38 billion. Over 9 months, PGI achieved VND 245 billion in pre-tax profit, reaching 80% of its annual plan.

Military Insurance Corporation (stock code: MIC) saw a nearly fivefold increase in Q3 pre-tax profit to VND 154 billion, with post-tax profit rising similarly to VND 123 billion. In 9 months, the company earned VND 385 billion in pre-tax profit, up 85.8%, completing over 71% of its annual target.

Two subsidiaries of Bao Viet Group, Bao Viet Insurance and Bao Viet Life, reported strong results. Bao Viet Insurance achieved VND 9,610 billion in revenue, up 8.5%, with post-tax profit of VND 199 billion. Bao Viet Life recorded VND 33,350 billion in revenue and VND 1,562 billion in post-tax profit, increases of 3.7% and 59.1%, respectively. The parent company, Bao Viet Group, reported VND 1,328 billion in revenue and VND 942 billion in post-tax profit for 9 months, and plans to distribute over VND 783 billion in dividends for the 2024 fiscal year.

DBV Insurance (stock code: AIC) remains in the red, despite a 21.9-fold increase in Q3 gross insurance profit to VND 85 billion. This improvement stems from a 34% rise in net revenue to VND 669 billion, driven by a 42% increase in original insurance premiums to over VND 929 billion, while expenses grew only 18%, with claims expenses up 2% to VND 216 billion. Financial activities also improved, with gross profit rising 11% to VND 41 billion.

However, the rapid 67% increase in administrative costs, primarily due to personnel expenses of VND 141 billion, offset these gains. This led to a Q3 net loss of VND 12.5 billion for DBV, although significantly reduced from the VND 39 billion loss in the same period last year.

According to the Ministry of Finance, as of October 10, insurance companies had received 3,753 damage claims, with estimated compensation of nearly VND 1,675 billion. Most claims were for property and technical insurance, as well as motor vehicle insurance.

While the 9-month performance of non-life insurers is positive, the final quarter’s compensation pressure may be higher, posing a significant challenge for the industry.