Financial risk management in Vietnam’s Life insurance industry

Abstract

This thesis aims to gain a synopsis of the financial risk management practices adopted by life insurance undertakings in Vietnam. This study aims to provide valuable insights by exploring the implemented regulations and policies, their effectiveness, and their alignment with European practices. The theory framework includes risk management definition and framework, financial risk management categories, risk management framework, and the regulations set by Vietnam and the Nordic region. The research is conducted as a case study. The case study examines how risk management practices are implemented across life insurance companies in Vietnam and Finland, highlighting diverse strategies against different regulatory environments. Vietnamese companies demonstrate alignment with regulatory expectations but lack the detailed risk management frameworks found in European practices. The study underscores the Vietnamese law's need for a more complex and structured risk management framework. The thesis advocates adopting risk-based capital requirements, implementing comprehensive ERM and ORSA processes, and enhancing transparency to strengthen the life insurance regulatory regime.