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On December 10, 2025, Vietnam's National Assembly enacted Law No. 139/2025/QH15 amending the Law on Insurance Business. The amendment, effective from January 1, 2026, introduces various changes in an effort to lift restrictions and hurdles for insurance businesses. Key points that may impact the activities of stakeholders in Vietnam's insurance market are highlighted below.
Management Personnel Qualifications
To broaden the talent pool while ensuring competency standards, the amended law opens up the positions of director or general director to more candidates. Previously, candidates were required to hold either (i) a university degree or higher in insurance or (ii) a university degree in another discipline and an insurance certificate issued by a qualified insurance training institution. Now, candidates holding a university degree or higher in economics, finance, banking, law, business administration, accounting, or auditing, with at least one insurance‑related module, are also accepted.
These changes are expected to mitigate the ongoing challenges faced by insurers in recruiting suitably qualified candidates for key executive positions, while still maintaining appropriate professional standards.
Fewer Registrations for Insurance Businesses
As part of the legislature's broader initiative to reduce administrative burdens across all business sectors, the amended Law on Insurance Business relaxes registration requirements for the insurance industry, notably:
- Insurance enterprises and foreign non‑life insurance branches are no longer required to register and obtain prior approval from the Ministry of Finance (MOF) for their methodologies and bases for calculating premiums for motor vehicle insurance products (excluding compulsory civil liability insurance for motor vehicle owners). Instead, insurance enterprises are now only required to notify the MOF before applying or amending these methodologies.
- While life insurers must continue to register with the MOF their principles for separating owners' equity from insurance premium funds, non‑life insurance enterprises and foreign non‑life insurance branches are now only required to notify (rather than register with) the MOF these principles prior to implementation.
Extended Compliance Milestones for Businesses' Readiness
The risk‑based capital (RBC) regime, a capital adequacy framework requiring insurance businesses to maintain minimum capital levels proportionate to their risk exposures, was introduced in 2022 to replace the current fixed solvency margin framework, and was originally scheduled for full adoption in 2028. However, recognizing the technological and practical challenges faced by both insurers and regulators in implementing the RBC regime, the amended Law on Insurance Business has a phased timeline, drawing on Hong Kong's experience where Hong Kong regulators allowed insurance businesses a three-year transitional period to prepare resources and upgrade their systems.
Core RBC requirements (including actual capital, risk‑based capital, and capital adequacy ratio) will apply from January 1, 2028, while supervisory intervention measures will only take effect from January 1, 2031. From 2028 to 2030, insurers will operate under a transitional period, during which they must monitor capital based on RBC principles and may adopt self‑directed capital‑increase plans if shortfalls arise.
This extended deadline allows insurers additional time to upgrade systems, remedy data and accounting gaps, and prepare for full RBC compliance, enhancing stability and regulatory certainty.
Insurance Agent Certifications Extended by Six Months
The deadline for insurance agent certificates issued before January 1, 2023, to be converted to the new standardized certificates was originally December 31, 2025. The amended law allows these certificates to remain valid for an additional six months, until June 30, 2026. This extension provides insurers with needed time to compile, review, and standardize documentation for its insurance agents, addressing longstanding inconsistencies in historical records and easing the operational burden of processing a large volume of certificates.
Outlook
With the amended Law on Insurance Business now in effect, insurers and stakeholders should begin assessing how the revised qualification standards, reduced administrative procedures, phased RBC implementation, and extended insurance agent certificate transition will affect their operations.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
