Myanamr’s fledgling insurance market has grown about 40 percent since it was opened up two years ago.
In 2013, state-owned Myanmar Insurance relinquished its monopoly to allow a private market to emerge, with the participation of foreign companies, 21 of which have since opened representative offices here.
“Foreign companies have been opening one new representative office a month. That shows they trust the Myanmar insurance market,” said deputy finance minister U Maung Maung Thein at the launch of Marsh Insurance’s representative office in Yangon.
“Although they are not yet allowed to operate, their presence supports growth in a market in which they will one day be allowed to compete,” said the deputy finance minister.”
They are training staff and sharing experience that will build and develop Myanmar’s insurance market.”
Explaining the 40pc figure, he said, “The growth is calculated on the basis of premium fees earned by insurance companies. Every company is earning at least K1 billion a month in premiums.”
He added that insurance companies were also paying out more, using simplified claiming methods.
Computerisation, better staff training and faster payouts also lent more popularity to the new market, he said.
“More people are paying premiums. Companies are advertising their products and encouraging their staff to be active and effective. This has led to significant improvements and market expansion.”
As local private insurance companies compete, three Japanese insurers have been permitted to operate in special economic zones, offering four types of coverage, including fire insurance.
According to the director general of Myanmar Insurance, U Aye Min Thein, foreign companies must share 10 percent of proceeds if they enter into a partnership with Myanmar Insurance.
The companies paid US$30,000 for their license fee, plus a $10,000 monthly fee.
“We consider the 10pc payment to be an acceptable amount for a partnership, and the companies can gain more trust by cooperating with the state-owned insurer.”
Martin South, CEO of Marsh Singapore, which works in cooperation with Myanmar Insurance, said, “If Chinese, Japanese, Korean and other companies were to enter Myanmar, we would support the entry of those countries to do business here.
“We would be able to join Myanmar to our networks all over the world.”