Vietnam: What are the maximum insurance agent commission rates for life insurance policies under Circular 67/2023/TT-BTC?
What are the maximum insurance agent commission rates for individual life insurance policies in Vietnam under Circular 67/2023/TT-BTC?
Under Circular 67/2023/TT-BTC guiding the Law on Insurance Business and Decree 46/2023/ND-CP as follows:
For individual life insurance policies, the maximum insurance agent commission rates are determined at Point 3.2, Clause 3, Article 51 of Circular 67/2023/TT-BTC as follows:
- For individual life insurance policies issued before July 1, 2024, the maximum insurance agent commission rates are as follows:
Insurance type | Maximum insurance agent commission rate (%) | |||
Payment in installments | Payment in a lump sum | |||
Policy first year | Policy second year | Policy following years | ||
1. Term life insurance | 40 | 20 | 15 | 15 |
2. Pure endowment insurance - Term of insurance from 10 years or less | 15 20 | 10 10 | 5 5 | 5 5 |
- Term of insurance over 10 years | ||||
3. Endowment insurance: | ||||
- Term of insurance from 10 years or less | 25 40 | 7 10 | 5 10 | 5 7 |
- Term of insurance over 10 years | ||||
4. Whole life insurance | 30 | 20 | 15 | 10 |
5. Annuities | 25 | 10 | 7 | 7 |
6. Universal life insurance | ||||
10 years or less | 25 | 7 | 5 | 5 |
Over 10 years | 40 | 10 | 10 | 7 |
7. Unit-linked insurance | 40 | 10 | 10 | 7 |
- For individual life insurance policies issued before July 1, 2024, the maximum insurance agent commission rates are as follows:
+ For insurance policies with a term of 1 year or less and 1 year of annual renewal: 20%
+ For insurance policies over 1 year:
Insurance type | Maximum insurance agent commission rate (%) | |||
Payment in installments | Payment in a lump sum | |||
Policy first year | Policy second year | Policy following years | ||
1. Term life insurance, whole life insurance | 40 | 20 | 15 | 15 |
2. Pure endowment insurance, annuities, endowment insurance: | ||||
- Term of insurance from 10 years or less | 25 | 7 | 5 | 5 |
- Term of insurance over 10 years | 30 | 20 | 10 | 7 |
3. Universal life insurance, unit-link insurance | 30 | 20 | 10 | 7 |
What is the insurance agent commission rate for retirement insurance policies in Vietnam?
Under item b, point 3.2, clause 3, Article 51 of Circular 67/2023/TT-BTC as follows:
Insurance agent commission
....
3.2. Maximum insurance agent commission rates for life insurance policies:
...
b) Insurance agent commission for retirement insurance policies: 3% of total insurance premium;
Thus, the insurance agent commission rate for retirement insurance policies in Vietnam is 3% of total insurance premium.
What is the insurance agent commission rate for group life insurance policies in Vietnam?
Under item c, point 3.2, clause 3, Article 51 of Circular 67/2023/TT-BTC as follows:
Insurance agent commission
....
3.2. Maximum insurance agent commission rates for life insurance policies:
...
c) As for group life insurance policies: The maximum insurance agent commission rate is equal to 50% of the corresponding rates applicable to individual life insurance policies of the same type.
Thus, the insurance agent commission rate for group life insurance policies in Vietnam is equal to 50% of the corresponding rates applicable to individual life insurance policies of the same type.
What are the responsibilities of life insurers in Vietnam?
In Article 8 of Circular 67/2023/TT-BTC, the responsibilities of life insurers in Vietnam are specified as follows:
Responsibilities of insurers, branches of foreign non-life insurers, mutual microinsurers, and insurance brokers
1. Notify the Ministry of Finance of the information stated in Article 6 of this Circular.
2. Prepare and send reports using the Form No. 4 - MGBH: Report on annual online insurance provision; Form No. 20-NT: Quarterly/annual report on number of established and cancelled online policies; Form No. 3-PNT: Quarterly/annual report on revenue and claims by distribution channels as outlined in this Circular.
3. Develop and make public the following information on their website:
a) List of online insurance services and products, and forms of provision;
b) A description of the insurance provision process via the website/e-commerce selling website (full/partial process); the insurance provision process via e-commerce trading floor (partial process); the insurance provision process through networked applications (full/partial process); personal information protection and dispute resolution policy.
4. Ensure availability of technical infrastructure and personnel for online insurance provision.
5. Ensure compliance with legal regulations on insurance business, legal regulations on electronic transactions and relevant legal regulations.
6. Insurers, branches of foreign non-life insurers, and mutual microinsurers shall manage the online insurance services and products offered by insurance agents into which they have entered an insurance agent contract.
7. Promptly provide complete information, data, and documents related to their online insurance provision when requested by competent authorities.
8. In case of contracting with a third-party provider that provides IT infrastructure services to provide online insurance services and products, they must sign a contract and maintain the cooperation with this third party in complying with this Circular and regulations on electronic transactions in financial activities and other relevant legal regulations.
Thus, life insurers in particular and insurers in general must fulfill the above responsibilities.
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