Kingdom’s insurance sector faces challenges

ALTHOUGH no official report on the insurance industry has been officially released yet, the president of the Insurance Association of Cambodia publicly stated that Cambodia’s insurance sector had positive growth in 2022, while adding that this year seems to be uncertain with some challenges as well.

Cambodia Insurance Association President Huy Vatharo said that the insurance sector growth was in line with the development of the country’s economic situation as well as the finance and banking sector.

“In economic forecasting, we see that there are a number of uncertainties that could affect economic performance in the coming year. Although our forecast for this sector is positive, according to the government’s report there remains the possibility of some uncertainties that we must be flexible about dealing with should such things occur,” he said.

Youk Chamroeunrith, Forte group CEO, also said that the uncertainty related to the current global political and economic situation had posed many challenges for the insurance sector this year, resulting in rising insurance prices.

However, Chamroeunrith remains optimistic that the Cambodian insurance sector would continue to grow over the next year.

He pointed out that although this sector was still young compared to that of other countries in the region, its growth in the Kingdom was taking place at a high rate.

“The uncertainty of the global economic situation caused by the impact of the Covid-19 crisis, the war in Ukraine and inflation may also have some negative impacts on the global insurance sector, including Cambodia’s.

“Challenges that the Cambodian insurance sector may face include rising insurance costs and an inability to reduce customer costs. All these issues will continue to transfer risks to major international reinsurance companies,” he said.

According to Chamroeunrith, in 2022, Forte group had a market share of about 45 per cent among 18 general insurance companies operating in the Kingdom.

According to a report from the Insurance Association of Cambodia, premiums in the insurance sector in Cambodia as of the third quarter of 2022 reached $258.7 million, an increase of 15.6 per cent compared to the same period in 2021.