Prudential Corporation Asia yesterday received “in-principle” approval from the Ministry of Economy and Finance to establish a foreign-owned life insurance operation in the country, an official statement from the company said.
The announcement comes after Canadian life insurance giant Manulife on Thursday made public plans for a new head office in Phnom Penh and intentions to invest up to US$20 million in Cambodia over the next five years.
State-owned Cambodia Life launched in May and was the Kingdom’s first life insurance company, the Post reported earlier this year.
Prudential plans to invest $7 million in Cambodia’s insurance industry, British Ambassador Mark Gooding said on Friday.
Prudential established a representative office in Phnom Penh in December 2010, and will be relocating its premises to Phnom Penh Tower Building, which will be its corporate office in Cambodia, the company said in a statement.
Manulife and Prudential moving into Cambodia does not indicate companies “flocking” to the Kingdom, said Infinity insurance CEO David Carter. “These companies have been trying to get approval for about two years but have only recently been granted it,” he said.
Manulife will take “around three years” to become profitable, Youk Chanroeunrith, general manager of Forte Insurance, told the Post on Thursday.
This estimate is based on general insurance rather than life insurance, said David Carter. It would take “way beyond” five years for the two new life insurance companies to become profitable, he said.
The Cambodian Securities Exchange will benefit from the two new insurance companies as it is common for life insurance companies to invest in bonds, he said.
Prudential now spans 13 markets in Asia, covering Cambodia, China, Hong Kong, India, Indonesia, Japan, Korea, Malaysia, The Philippines, Singapore, Taiwan, Thailand and Vietnam.