New study shows people paying more attention to insurance

New study shows people paying more attention to insurance

Vietnamese people are increasingly interested in life insurance, with up to 89 per cent of respondents viewing it as highly important in daily life, according to new independent research on awareness and behaviour regarding insurance.

According to Deputy Secretary General of the Insurance Association of Vietnam (IAV) Nguyễn Phong Cầm, this was the first time in more than 30 years that the Vietnamese life insurance industry conducted such a study.

The publication of the study provides a panoramic picture of the awareness and importance of life insurance for society. It is also an important basis for management agencies, businesses and the entire insurance industry to build appropriate solutions to better serve people in the future, Cầm said.

Based on a survey conducted by market research firm IFM Research, the study covered 1,265 respondents in both urban and rural areas across Hà Nội, HCM City, Hải Phòng, Đà Nẵng and Cần Thơ.

The research showed that 89 per cent of respondents assess life insurance as essential in life. This rate reached 91 per cent in the group that owns life insurance contracts, 86 per cent in the group that does not own them and 91 per cent in the group that used to own them.

At the same time, the study also recorded a relatively positive level of understanding of life insurance by survey participants. According to the survey, an average of 58 per cent of participants self-assessed themselves as having a high level of understanding of life insurance.

This rate is fairly uniform between age groups, with 57 per cent in the 22-29 age group, 59 per cent in the 30-40 age range and 58 per cent in the over 40 age group.

Respondents said that life insurance is considered necessary due mostly to the basic needs of each family. Fifty-seven per cent of respondents believe that life insurance helps protect against disease, accident and death risks, while 45 per cent emphasise the role of financial stability for families.

Despite the positive perception of its essential nature, the study reveals a paradox in actual financial behaviour. Rather than using insurance as a forward-looking risk management tool, most people continue to adopt a defensive financial mindset.

When an incident occurs, the first solution they think of is to use savings (67 per cent), cut spending (53 per cent) or find additional sources of income (39 per cent).

This reflects the fact that life insurance is still seen as an additional layer of protection, not yet a core risk management tool or long-term investment solution in personal financial strategies.

IFM Research CEO Ralf Matthaes said that people's financial behaviour is still mainly defensive.

Although demand for and positive assessment of life insurance is high, the actual ownership ratio is still low.

This is both a challenge and an opportunity for brands to reshape the market by simplifying terms in insurance contracts, increasing information transparency and improving the quality of consulting and formal financial education.

The study also pointed out the main barriers that prolong people's decisions to buy life insurance. These include long premium payment times, prioritising other savings or investment channels, financial difficulties or not seeing urgent needs.

For those aged 22-29 years old, a lack of appropriate advice is the biggest obstacle.

According to the study, financial pressure is the main reason for difficulty in maintaining long-term contracts.

The current average premium costs about VNĐ1.8 million (US$70) per month, which is considered a significant barrier when income fluctuates or when people do not clearly understand actual value compared to expectations. 

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