HÀ NỘI — A clear shift is emerging in Việt Nam’s bancassurance sector.
After years of growth driven by lucrative exclusive distribution agreements, banks are now focusing more on customer value, service quality and sustainable revenue generation.
According to ABBank, insurance sales increased tenfold in the first quarter of this year compared to the same period last year, while net service income rose approximately 2.4 times.
These results came after nearly four years of restructuring its bancassurance operations, including the early termination of its exclusive insurance distribution agreement with FWD Việt Nam in 2022 and the subsequent partnership with Dai-ichi Life Vietnam.
A similar trend can be observed at Techcombank. The bank terminated its exclusive bancassurance partnership with Manulife ahead of schedule and recorded an associated expense of approximately VNĐ1.8 trillion (US$68 million). Following the termination, Techcombank continued to strengthen its presence in the insurance sector through Techcom Life.
Data from the Insurance Association of Vietnam (IAV) shows that Techcom Life had generated approximately VNĐ570 billion in new business premiums by the end of April this year, ranking among the top five life insurers with the highest new business premium revenue in the market.
The bank’s first quarter 2026 financial statements also revealed insurance service fee income of more than VNĐ429 billion, representing a year-on-year increase of over 100 per cent.
These two examples illustrate that, following a period of rapid growth driven by high-value exclusive insurance distribution agreements, the market is entering a new phase that places greater emphasis on advisory quality, policy persistence and long-term customer value.
According to IAV, insurers affiliated with banks currently account for around 25 per cent of total non-life insurance premium revenue in the market.
Despite undergoing a significant adjustment period, insurance remains one of the service segments in which banks continue to invest, although their approach has changed considerably.
According to an analysis by DNSE Securities, this transformation has occurred alongside a tightening regulatory framework governing bancassurance activities.
The State Bank of Vietnam has required credit institutions to review and update insurance-related service practices since 2023, ensuring that customers are not compelled to purchase insurance products in any form.
This requirement was subsequently codified in the 2024 Law on Credit Institutions, which explicitly prohibits tying the sale of non-mandatory insurance products to the provision of banking products and services.
At the same time, increasing compliance requirements and the need to diversify revenue sources are prompting banks to adjust their insurance strategies.
As net interest margins are no longer as favourable as in previous years, fee-based income is playing an increasingly important role in profit structures.
Rather than relying on upfront fees from exclusive distribution agreements, many banks are focusing on deeper engagement with their existing customer base, expanding their financial ecosystems, and participating more actively in the insurance value chain through new partnership and investment models.
DNSE’s analysis indicates that changes in bancassurance over the past two to three years have been particularly evident among joint stock commercial banks.
A distinguishing feature of the current investment wave is that insurance operations are being restructured to align more closely with each institution’s customer ecosystem.
After a growth phase heavily dependent on exclusive agreements with substantial upfront fees, bancassurance is increasingly driven by customer quality and the ability to generate sustainable service income over the long term.
Meanwhile, banks continue to possess significant advantages in customer data, distribution networks and digital banking platforms. These strengths help reduce customer acquisition costs and expand the capacity to offer integrated financial products.
At this year’s annual general meeting of shareholders, TPBank submitted a proposal to establish a non-life insurance company in which it would hold at least a 50 per cent ownership stake.
Around the same time, ACB approved a plan to establish its own non-life insurance company, targeting total assets of approximately VNĐ2 trillion after five years of operation.
Previously, VPBank shareholders approved a plan to contribute capital toward establishing a life insurance company with an expected charter capital of VNĐ2 trillion.
The fact that many banks are no longer limiting themselves to the role of insurance distributors, but are instead establishing and acquiring ownership stakes in insurance companies, demonstrates a strategic shift toward generating more stable service income through customer ecosystems and long-term insurance services.
This is also viewed as one of the key avenues for commercial banks to expand non-interest income as credit growth opportunities and net interest margins become less favourable than in previous years. — BIZHUB/VNS
