Vietnam Travel Insurance Shunned by Local Operators | Insurance ...

Image courtesy of David McKelvey

Numerous foreign insurance companies have entered Vietnamese markets in recent years, boosting?the industry?s competitiveness and helping to diversify the range of products on offer, yet the Vietnam travel insurance sector is yet to be penetrated, something that has led to underdevelopment in the local industry, claims consultancy firm Research and Markets.

Travel agencies in the country are compelled by Vietnam law to offer insurance to their customers, yet the Association of Vietnamese Insurers said that almost 95% of the 22.5 million local an foreign tourists who booked with agencies were not offered any form of coverage.

The country has recently seen a number of high profile incidents with its ferries, most recently in May, when 28 French nationals had a luck escape after their vessel sunk in Ha Long Bay. This followed an earlier fatal accident in January, in which 40 people were killed.

Industry analysts claim that hardly any tourism enterprises in Vietnam understand the importance of travel insurance, and even those that do only offer coverage to foreign tourists. As a result, the Vietnam travel insurance industry is dominated by foreign companies, and has even led to local tour operators being shunned in?favour?of foreign-owned operators, as these are far more likely to provide travel insurance.

?Travel insurance is almost like a passport to traveller safety,? said Sara Hub, a Dutch businesswoman who regularly travels to Vietnam. ?Most Vietnamese travel agencies won?t offer insurance, and so I always use foreign operators,? she told the Dau Tu Tai Chinh newspaper.

What makes matters worse is the incredibly low cost of?travel?insurance for local tours, which averages just $1.50 a day. Yet despite this, local operators continue to ignore it.

Justifying the local operator?s stance, one travel agency director in Ho Chi Minh City, who declined to be name, said that agencies usually try to lower their prices as much as possible due to the trend for foreign tourists to go on low-cost tours, something which can be put down to the poor economy.

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Posted by Tom Stone on September 13, 2011. Filed under Travel Insurance. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

Source: http://www.insurancenewsplus.com/vietnam-travel-insurance-shunned-by-local-operators/987835/

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