Manulife, the Canadian life insurance giant, officially announced the opening of an office in Phnom Penh yesterday and said it has plans to invest up to US$20 million in Cambodia over the next five years, in what was described by market insiders as a “historical” moment.
The announcement was made at a press conference at Raffles and was presided over by Aun Porn Moniroth, minister attached to the prime minister and secretary of state of the Ministry of Economy and Finance.
Manulife will “initially” invest $7 million in Cambodia but plans to invest “about” $20 million over the next five years, said senior vice president and chairman of Manulife Cambodia David Wong.
The willingness of international players in life insurance to invest in Cambodia sets a “new benchmark” for the insurance market in Cambodia, said Youk Chanroeunrith, general manager of Forte Insurance.
The launch is a “very positive” sign for Cambodia, as the company will bring expertise and increased capacity in human resources and capital, he said.
The company will take “around three years” to become profitable, he added. State-owned Cambodia Life launched in May and was the Kingdom’s first life insurance company, the Post reported earlier this year.
Cambodia’s GDP was just over $900 per capita last year, according to the Ministry of Economy and Finance. Despite Cambodia’s relatively low GDP, the company will be able to succeed in the Kingdom, Youk Chanroeunrith said.
“Vietnam started with life insurance a few years ago when they had a GDP of around $600 per capita, and the life insurance market their is quite strong now,” he said.
Manulife is “thinking about” working with local banks to offer insurance through bank branches, David Wong said.
“Customers may not know a lot about insurance, as the concept is somewhat complicated, and many Cambodians are not familiar with it,” said Ty Atith, assistant to the chairman of the General Insurance Association of Cambodia.
Manulife plans to implement a two-month “consumer education” program in the Kingdom, said David Wong in a statement, but did not expand on what this might involve.
To contact the reporter on this story: Abe Becker at [email protected]