Change in Kingdom life as players drive industry forward
The Covid-19 pandemic has revealed two profound changes in the life insurance segment – a growing positive consumer perception of insurance and insurers abandoning traditional sales channels to enter the digital space and improve delivery.
As the unprecedented pandemic has strained public health services, destroyed livelihoods and businesses, changed lifestyles and hurt economies around the world, the life insurance industry of the Kingdom was relatively spared.
Impressive figures from the Insurance Regulator of Cambodia (IRC) speak volumes about the survival and performance of the industry, although still in a nascent stage, with premium value in 2021 reaching $293 million , an increase of 9.5% year-on-year.
General insurance market gross premium was $123 million – a 7.4% jump from 2020 – while life insurance premiums were $170, according to the IRC. million, up 11% – impressive numbers during a dark pandemic period in which many other sectors have suffered.
Established insurers like Etiqa Life Insurance, Sovannaphum Life Assurance and GC Life Insurance have taken the right approach and expect good business after weathering the pandemic which has stunted business growth.
“The life insurance market in Cambodia has so much potential,” said Hong Vuthy, CEO of Etiqa.
The growth of the sector is driven by 18 general insurers, 14 life insurers, seven microinsurance companies and one reinsurance company, reaching approximately 16 million Cambodians.
The pandemic is forcing people to rethink ways to manage health care, increasing the recognition of life insurance, industry watchers say.
Health insurance and life cover help cushion the high costs of medical expenses, especially in private hospitals, bringing relief to the financially vulnerable.
The growing demand for life insurance is also fueled by increased public awareness.
In recent years, insurance companies in the Kingdom have consistently emphasized the importance of insurance – through extensive educational and community campaigns – which have helped spread the message that insurance cover is a security long-term health, contributing to the growth of the sector.
CEO of Sovannaphum Life, Loke Kah Meng, said, “Cambodians are now increasingly aware of the benefits of life insurance as part of financial protection for their families.
Drive product innovation
As public perceptions have changed, insurers have also quickly kept pace with the changing trend.
The landscape of the insurance industry has been changing since the onset of Covid-19, which forced insurers to review their business strategies as demand for life insurance increased.
Life insurers that have traditionally relied on labor-intensive businesses are rapidly shifting to digital platforms to continue serving their customers efficiently and remotely.
Virtual meetings, the widespread use of chatbots – a facility for digital interaction – uninterrupted services and faster processing of claims, for example, are changing the way insurance companies operate.
These movements have redefined the orientation of the industry, particularly in Cambodia, where it is considered a booming sector since less than 10% of the population is insured.
Companies focus on product innovation, deploy innovative insurance solutions to meet ever-changing customer needs, and design customer-centric products.
“We can see that Cambodian women are contributing more to the country, to society and to their families,” said Michael Tee, CEO of GC Life Insurance.
By responding to specific markets, investing heavily in digital platforms to be more efficient, and reskilling their workforce to better serve customers in a challenging environment, insurers in the Kingdom are constantly driving the industry forward.