MTL keeps CLMV push up as Thais age

MTL keeps CLMV push up as Thais age

Muang Thai Life Assurance (MTL) is continuing its aggressive move into the Cambodia, Laos, Myanmar, Vietnam and Thailand (CLMVT) region to acquire a larger market with a more balanced demographic profile, as Thailand becomes a full-fledged ageing society in 2021, said Sara Lamsam, MTL's president.

MTL has operations in four countries through four joint venture companies, namely ST-Muang Thai Insurance in Laos, MB Ageas Life in Vietnam, Sovannaphum Life Assurance and Dara Insurance in Cambodia and one representative office in Myanmar.

Dara Insurance, a non-life joint venture company with Sovannaphum Life Assurance, is the latest move after MTL entered Cambodia four years ago through a joint-venture with Canadia Bank, the local second largest life insurance company, to set up Sovannaphum Life Assurance.

The CLMVT market has very high potential, with the total population edging near 300 million people with a favourable demographic mixture, he said.

These countries, except Vietnam, despite having smaller population sizes than Thailand, have younger populations that will help offset the shrinking domestic market when Thailand becomes a fully ageing society next year.

"Cambodia is MTL's core focus due to rapid economic growth of 14.2% year-on-year during 2014-19 that led to growing demand for insurance protection," he said.

Auto, auto-parts, and related industries in Cambodia have grown rapidly along with the country's economy, construction, and tourism.

MTL's new non-life insurance arm will focus on simple products, vehicle insurance, property insurance and engineering insurance.

Vietnam is another attractive market where MTL flagged a joint venture, MB Ageas Life Insurance, between Military Commercial Joint Stock Bank and Ageas Insurance which now ranks second in term of bancassurance distribution channels, and 7-8 in overall premiums.

In a smaller country such as Laos, ST-Muang Thai Insurance occupies the largest market share in insurance through a joint venture company made up of three partners, namely MTL, Muang Thai Insurance and ST Bank. The company has composite licences that enable the company to operate both life and non-life insurance.

MTL is also looking for opportunities to expand in Myanmar, where the company has a representative in Yangon.

"We are familiar with CLMV markets as bancassurance and agents are major distribution channels that we already have expertise in. We can also easily take steps from traditional methods to digitalise our selling channels," Mr Sara said.

Most people in CLMV are also looking for endowment insurance and health protection similar to those available in Thailand, with the exception of Vietnam, where demand is focused on universal life insurance products.

MTL is also studying the feasibility of expanding to Malaysia, the Philippines and Indonesia.

He said the Philippines still allows insurance companies to apply for new licences, while applications to Malaysia and Indonesia are limited. New players are not allowed to enter except through mergers and acquisitions.

"We will go if there is an opportunity. The world has changed a lot, so we may have to reassess whether to go as insurance companies, brokers, or TechBrokers," he said.

Do you like the content of this article?
COMMENT