Congratulations on the 10th anniversary of Prudential Vietnam. What have been the most significant achievements over the last ten years?
I think the biggest successes are the trust of customers in Prudential, which builds up our prestige, and the values that we bring to them through our services and products. There are many factors contributing to the success of Prudential in Vietnam. The first are the strength and prestige of Prudential and the support of the parent group. The legal environment for the life insurance business in Vietnam is being improved. We have made thorough preparations for the implementation of our strategy. However, the foundation of our success is our human resources. More than 40,000 staff and agents at Prudential have been selected and trained carefully in a professional environment where they are challenged but also rewarded for their contributions. Their professional attitude, skills and strong ambition for success were key factors for Prudential in moving quickly to the leading position in the market in its first year and maintaining that position for the past ten years.
You said that human resources are a key factor in the success of Prudential Vietnam. What is your strategy for training and developing agents?
Prudential’s large, professional agent network plays a significant role in our business operations. It is they who present our daily image to the public. We have therefore focused on investment in our agents in terms of both recruitment and professional training. We have a very well-organised agent support system - agency development, agency support and agency training - and also frequently provide upgraded training to enhance quality and professionalism. This year we initiated several new training programs and rolled out training automation to equip agents with sufficient professional skills. By October we had recruited over 40 per cent more agents than in the same period last year and have increased our agent network by over 25 per cent. What’s also very important is that starting in Q3 this year all new agents must take a standardised test provided by the Ministry of Finance (MoF). The test can be administered by MoF and it certifies the results before licensing. Prudential has quickly adjusted our processes to meet these new requirements. We are also preparing for on-line tests to improve the quality and efficiency of the testing process. Besides ensuring consistency and high standards in licensing new agents, the new process has also enhanced the image of the insurance agent profession, as it is now officially recognised by the government and society.
Traditional and mixed services dominate the life insurance market in Vietnam. What do you think about the emergence and development of non-traditional products, including joint products and bancassurance?
Thanks to the strong Vietnamese tradition of prioritising education for their children, traditional endowment products, particularly education and savings, have become the favourite choice of many customers. However, the same objectives of ensuring a future for our children can also be achieved with other types of products such as universal life and unit-linked products. Thanks to their flexibility, unit-linked products can meet the multiple objectives of protecting, saving, and investing at any life stage. In other regional countries, such as Hong Kong, Singapore, Malaysia, and Indonesia, for many years now unit-linked products have been very popular and account for over half of policies sold. In early 2008 Prudential became the first company to launch unit-linked products in Vietnam. We’ve seen very encouraging results, with 10 per cent of our new business premiums in Ho Chi Minh City and Hanoi coming from this new product and 70 per cent of new unit-linked policies being sold to existing customers. We are hoping to obtain regulatory approval for expanding the product nationwide. As awareness of the benefits of life insurance improves, protection products such as term life and credit life (via the bancassurance channel) will also become more popular. These products are more affordable for people on lower incomes who wish to be protected, or for higher income earners who use life insurance as a means of protecting their wealth or lifestyle.
Can you tell us more about the advantages of bancassurance?
I would say that the potential advantages of this channel are significant. Firstly, it is a completely unexplored area that offers significant growth potential. The banks are growing their consumer base rapidly, and with insurance penetration being fairly low in Vietnam bank customers can get access to insurance products in their branches. Bank customers can also use their bank accounts to pay their premiums, which is a major convenience in managing their long-term commitments with an insurance policy. The areas to work on are essentially in terms of training and the development of awareness about bancassurance in general among customers and, in particular, banking staff. Insurance products need to be treated as another product in the portfolio of banks. With an increased focus from the banks and investment by the insurance companies in training and development, the model can potentially yield strong results in the coming years. Prudential has witnessed relatively good growth of more 50 per cent, to October, from the bancassurance channel, compared with the same period of last year. Prudential is now present in over 40 branches of its partner banks, providing relevant insurance products to bank customers through more than 50 sales representatives. With the rapid development of the banking sector, and Prudential's continued investment in the channel, we aim to achieve higher growth rates in the years to come.