HCMC – The Ministry of Finance has proposed delaying the implementation of the risk-based capital (RBC) model for insurers to 2031 from the original deadline of 2028.
The ministry said the delay would give insurers more time to build up financial resources and upgrade systems. It cited a lack of capital, skilled personnel, and accounting systems still based on book value that do not meet RBC requirements.
The RBC framework, which aligns with international standards, requires insurers to maintain capital levels proportional to their risk exposure to ensure financial safety and market stability.
Between 2028 and 2030, insurers and reinsurers will be required to calculate capital adequacy under both the current and RBC models and may choose suitable plans to raise capital during this period.
The proposed delay is part of amendments to the 2022 Insurance Business Law aimed at cutting at least 30% of business conditions and administrative procedures.
The draft also proposes easing staffing rules, allowing dual roles and more flexible qualification requirements, while continuing to prohibit agents from working for multiple insurers of the same type. Non-life insurers would only need to notify regulators, rather than register, when adjusting motor vehicle insurance premiums.
Under the proposal, insurers and reinsurers could invest abroad only with regulatory approval and would be barred from using customer funds to cover risks. Foreign insurance branches in Vietnam would not be permitted to invest overseas.
Other changes include stricter rules for insurance brokers, who must invest under safety and liquidity principles and avoid funding shareholders or related parties. Branch registrations and closures would be handled by provincial authorities instead of the ministry.
Insurance agent certificates issued before the amended law takes effect would remain valid until June 30, 2026, to ease the transition.
