This paper provides an analysis of expost facto effects after the entry of foreign companies intothe Vietnamese insurance market and argues that foreigncompetition has positively impacted the insurance industrybased on evidence from Vietnam. Based on 16 years of data,the paper presents the main observations on the impact ofinternational competition on the insurance market afterVietnam opened up to foreign investors. The results showthat in Vietnam: after foreign penetration, local companiesdo not lose market share rapidly as liberation takes time;foreign insurers may dominate the domestic market, but ifinsurance penetration is low, this impact does not endangerthe financial security of the country; the dominance offoreign insurers in the life sector could change thetraditional insurance trajectory in emerging economies ,which are traditionally oriented mostly on developingcompulsory third-party liability insurance; foreign insurersmake long-term contributions to the local economy if theyinvest in local capital markets. Thus, the paper argues thatforeign competition has positively impacted the insuranceindustry based on evidence from Vietnam.
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