case study prudential vietnam assurance private limited company

For the year 2021, Prudential has acquired the all out resource of 6,0billion USD 141,1 trillion VND, and the organization''''s income was 1,6 billion USD 39,1trillion VND.Prudential Vietna

CASE STUDY: PRUDENTIAL VIETNAM ASSURANCE PRIVATE LIMITED COMPANY

Class: HM1601

Subject: Business Environment - ECO102

Instructor: Nguyen Thi Thanh Nhan

Group 2:

Nguyen Hoang Khanh Loan SA150079ー

Thai Tran Thao My SA150129ー

Ho Nhu Nhat Ky SA150078ー Huynh Nguyen Cong Toai SA150128ー

Table of Contents

VNR500 rating 36 (B1/2021)

37 Ton Duc Thang Street, Ben Nghe Ward, District 1, HCMC

(Source: VNR500, 2022)

Table 1 General Introduction

Introduced in Vietnam starting around 1995 and formally put into activity in 1999 with the message "Always listen Always understand", Prudential is giving monetary security and speculation answers for increment resources really for more than 1.6 million clients with a group of in excess of 230,000 expert specialists, 360 General Agent workplaces, exchange workplaces, and client support focuses in 63 territories and urban communities the nation over, with an organization of 8 trustworthy accomplice banks and an emergency clinic charge ensure framework at in excess of 366 medical clinics and facilities Prudential is likewise a trailblazer in applying present day innovation to work on processes, further develop client experience and backing the local area on their excursion to dominating their own wellbeing and life For the year 2021, Prudential has acquired the all out resource of 6,0 billion USD (141,1 trillion VND), and the organization's income was 1,6 billion USD (39,1 trillion VND)

Achievements

Prudential Vietnam Assurance Private Ltd has won the International Life Insurer of the Year

- Vietnam and New Insurance Product of the Year - Vietnam grants at the Insurance Asia Awards 2021 The insurance agency brought back home the awards for the third and second

a very long time in succession, separately The Insurance Asia Awards accumulates Asia's driving insurance agencies and perceives their extraordinary drives, items, and arrangements Starting around 2016, north of 130 insurance agencies from 30 nations have been regarded with this lofty honor Autonomous experts from major monetary and inspecting firms like Milliman, Deloitte, PwC, and Ernst and Young were individuals on the jury The passing judgment on board of the Insurance Asia Awards 2021 said: "PRU-Health+

is an interesting, market-changing protection item that champions comfort without compromising inclusion Prudential additionally keeps on being a good example of Vietnam's backup plans, supporting development while likewise raising its exhibition amid adverse consequences achieved by the COVID-19 pandemic

Missions & Vision

Prudential Vietnam’s sole mission is to help everyone to achieve the best things in life Prudential offers affordable, thorough healthcare solutions, finance protection and advice, while giving people counsel to plan their savings for life goals Moreover, Prudential's vision

is to be the top Non-life insurance company for Vietnamese households

2.1 Total asset and total employee

Being challenged by the unpredictable situation of the Covid-19 pandemic in 2021, Prudential Vietnam still can maintain the position as one of the best company in the insurance industry with the highest goal is to prolong sustainable development, expand the development of the economy, take action for the health and prosperity of the customers, as well as invest in charity and community activities to realize the company’s commitment is to support their customers achieve the best things in life As a result, the total assets of Prudential Vietnam in 2021 reached 6.0 billion USD (141.15 trillion VND) , which increased 15.4 percent compared to the previous year This achievement was achieved by the unity of the executive committees, all of more than 230.000 labors, including 1507 permanent employees with over 360 offices around 63 provinces in Vietnam always ready to serve more than 1.6 million customers nationwide

Figure 2.1 Total asset of Prudential Vietnam Assurance Private Limited Company

Figure 2.2 Prudential Vietnam Assurance Private Limited Company’s structure Prudential Vietnam Assurance Private Limited Company established the first office in Hanoi

in 1995 After 27 years of operation and development, Prudential Vietnam became a large business, pursuing to the Decree No 9/2018/ND-CP dated March 11th of the Government, with more than 230.000 financial consultants including 1.507 permanent employees, and this company owned 360 offices in over 63 provinces of Vietnam

Prudential is one of the top financial corporations in the world which specializes in providing life insurance products, financial services In addition, Prudential is a corporation that has a long business history, sustainable development, commitment to long-term, safe and effective investment In Vietnam, Prudential’s tertiary business sector is to provide health - caring, health - protection plans which help users to enjoy lives, protect them from unexpected accidents or deadly diseases More specific, there are nine total health-care plans that are available for customers

Additionally, Prudential also provides financial services for investment as well as earning For the investment and earning plan, the combination of insurance and investment solutions will provide a solid financial foundation in the face of uncertainties in life as well as bring an effective financial protection and savings plan to realize customers’ dreams and future plans The video attached below is the overall information about Prudential Viet Nam and their mission statements:https://www.youtube.com/watch?v=XPEROdXaDhE

2.4 Demand and Supply

Since the worldwide outbreak of Covid-19, the mindset about health and life of the Vietnamese have been changed, people nowadays are more likely to pay attention to their health than before the pandemic According to research information from YouGov (a well-known research company from the UK), the prolonged COVID-19 pandemic has made Vietnamese consumers consider buying and using private insurance services more The impact of COVID-19 on economic, social and health activities has made consumers particularly interested in health, insurance and life policies in an effort to protect themselves and their families Another YouGov survey showed that 26% of Vietnamese consumers said they increased the frequency of buying insurance products during the fourth wave of COVID-19 compared to before This trend opens up new opportunities for insurance providers in Vietnam

Additionally, YouGov’s Banking & Insurance Rankings illustrate that Prudential Vietnam ranked 2rd and 3rd with 6,3 total score In 2021, Prudential has paid more than 367.34 million USD (8.6 trillion VND) of insurance benefits to customers, up 37.6% over the previous year, accounting for about 26% of total market payments, fulfilling commitments to customers and being a fulcrum of solid finances for more than 1.6 million families in Vietnam

Prudential Vietnam sold insurance specifically for Covid-19 related health issues and have helped many cases with the total amount paid of 434,875 USD (10.2 billion VND) Prudential Vietnam did not clarify the money earned from insurance concerning Covid 19 but 2021 was

a very successful year for Prudential According to Prudential Vietnam's 2021 financial statements, the business saw excellent growth despite changes in the external market, most notably from the result of the Covid 19 pandemic Indicated by a 15.2% increase in total revenue to 1.7 billion USD (39,2 trillion VND)

Prudential Vietnam paid out more than 367.2 million USD (8.6 trillion VND) in insurance benefits to consumers in 2021, an increase of 37.6%, highlighting the company's dedication

to providing more than 1.6 million customers in the nation with access to health and financial protection 26% of the total industry claim payouts were made up of benefits that were actually paid out

Overall, 2021 was very favorable for Prudential Vietnam and they did not suffer from shortage or surplus

Figure 2.3 Financial Report of Prudential Vietnam (2021)

2.6.1 Total Revenue

● 2020: 1,448,439,905 USD (33,973,184,000,000 VND)

● 2021: 1,669,226,945 USD (39,151,748,000,000 VND) (increase 12.5%)

⇒ Total revenue of Prudential rose by 12.5% in 2021 with 1.7 billion USD compared to 2020 (1.4 billion USD) Despite the heavy attack of the pandemic on the economy, the company managed to conserve its foothold in the market, while making efforts to support its customers in need and the whole society in general They were able to maintain their annual revenue growth rate (around 10-20%) and make profits Nevertheless, their sundry income saw a rapid decrease by 77.3%

● 2020: 1,329,150,080 USD (31,175,239,000,000 VND)

● 2021: 1,647,183,006 USD (38,634,707,000,000 VND) (increase 23.9%)

⇒ Total cost also increased by 23.9% with 1.6 billion USD in 2021 compared to 2020 (1,3 billion USD) Due to such high demand for health insurance during the Covid-19 pandemic in treating patients, the company had to spend more expenses in insurance, with a sharp increase by 26,9%, about 279,1 million USD Since they mainly focused on the insurance and financial activities, their sundry cost was really low (54,3 thousand USD)

2.6.3 Total Profit (before tax)

● 2020: 119,289,825 USD (2,797,945,000,000 VND)

● 2021: 22,043,939 USD (517,041,000,000 VND) (decrease 81.5%)

⇒ As a result of the much higher increase in total cost compared to that in total revenue, the total profit (before tax) of Prudential Vietnam dropped drastically by 81.5 %, from about 119.3 million USD in 2020 to 22.1 million USD in 2021 Notably, the reason for the decline, according to their annual report, may be because they attempted to support for people by donating 213,1 thousand USD to the Covid-19 Vaccine Fund, and 511,6 thousand USD to many locals all over the country, aside from the dramatical effects of the pandemic on the company

2.7 Competitors

Although still leading the life insurance market in terms of both revenue and market share, Prudential Vietnam is facing stiff competition from both old and potential companies

In 2021, statistics from the Insurance Association of Vietnam (IAV) show that, the total insurance premium revenue of the whole market is estimated at 159,458 billion VND, up 22% compared to the previous year The largest market share Bao viet, accounts for 21.4%, then second is Prudential Vietnam, with VND 1,308 billion, accounting for 18.8% market share and Manulife is VND 440 billion, accounting for 14.3%

It can be said that the most formidable competitor of Prudential Vietnam today is Bao Viet Life, with a new mining market share that is closely following Prudential Next is Manulife Vietnam and AIA Vietnam Because Bao Viet is a domestic company, it is easy to attract Vietnamese customers, but Prudential believes that, with the resources, strength and prestige from a multinational company, they will soon regain 1 place like before.st

Prudential Insurance is a monopolistic competitor due to the following reasons There are many insurance companies in Vietnam that sell similar products in the insurance market namely life insurance, health insurance, property insurance, etc The products are similar but there are slight differences between each companies’ products For example, the price of insurance for Dengue fever that Prudential Vietnam and other insurance companies sell is around 2- 4 USD/year (50,000- 80,000 VND/year) but the insurance benefit is different between each company Prudential’s basic insurance plan pays for 213,5 USD (5,000,000 VND) while TCA’s equivalent plan only pays for 128.1 (3,000,000 VND) and VBI’s plan pays for 85.4 USD (2,000,000 VND) Furthermore, how one can get their insurance money is also different between each company

2.9 Macroenvironment 一 PESTEL Framework

2.9.1 Political Environment

Political factors may have an impact on the long-term profitability of Prudential Insurance Vietnam Co Ltd Firstly, Prudential Vietnam achieved political stability and people's recognition with the establishment in Vietnam from 1995.Prudential is also recognized when

it has won a noble title from the Government of Vietnam.Finally, Prudential Vietnam has followed financial regulations while organizing events

2.9.2 Economics Environment

According to figures from the Ministry of Finance as of July 2021, the insurance industry's GDP was a shining spot of the economy during the previous pandemic period, with the average growth rate of total revenue exceeding 20% It proved that Vietnamese were aware

of the demand of health insurance and its vital necessity for their health As a result, the firm now has a chance to grow

2.9.3 Social Environment

Prudential Vietnam always tries to understand their customers and offer the best solutions to them Prudential has stated some social factors that caused a great effect such as the influence of occupation on the insurance policy, health, environmental consciousness and so

on Notably, today, Vietnamese society frequently chooses higher-quality goods and services Life insurance is considerably more efficient compared to health insurance Therefore, it gives a chance for life insurance to flourish

Limited Company

Currently, businesses impose a strong importance on technology Artificial intelligence (A.I.) especially has been included into the activities of Prudential Insurance Vietnam Co.Ltd The benefits include avoiding mistakes in work, increasing productivity by handling clients’ problems faster, and enhancing the client experience

2.9.5 Environmental Environment

The health of humans has been significantly impacted by other factors Prudential Vietnam has proposed 3 factors - infectious diseases, contaminated food, and air pollution Those factors heavily damaged the ecosystem and human’s health Due to the fact that insurance

is currently a need, there is a rise in demand for it It gives the insurance market of Prudential Vietnam a chance to develop

2.9.6 Legal Environment

With a certain success, Prudential Insurance Vietnam Co Ltd has introduced legal factors to protect the rights of the company and the individuals (or organizations) purchasing insurance Moreover, they made a statement that they would not hold any responsibility for mistakes such as during the data entering procedure and so on Prudential Vietnam also registered copyright and trademark rights

3 Conclusion

With the motto "people are the foundation" and consistent action strategy, Prudential Vietnam is always recognized in the top 50 largest companies in Vietnam in general and the top 3 insurance companies specifically Prudential Vietnam will grow up day by day to embrace the economy and provide the Vietnamese with good values "Listen Understand Act" - slogan of Prudential, affirms the company’s commitment to always centralize their customers