Endowment policies have traditionally been popular in Cambodia. In 2023, they formed as high as 82% of all life insurance policies sold in the Kingdom.
This is despite insurers offering other types of insurance such as pure life or term life and whole life products. In 2023, gross premiums from endowment policies were at $159.70 million.
By market share, endowment policies stood at 82% of sales in 2023, followed by term life and group life sales at 8.7% each; and whole life sales which were 0.5% of total policies sold.
“It could be a reflection on the mindset of people buying life insurance. They expect to get something back if nothing has happened to them,” said Mr Huy Vatharo, CEO, state-owned reinsurer Cambodia Re, and Chairman, Insurance Association of Cambodia.
Consumers see endowment policies as one of the most effective ways to achieve financial goals like retirement, children’s education, and wealth accumulation, say industry insiders. “Endowment policies offer a combination of life insurance and a savings plan, which means customers get protection for their loved ones in case of certain unwanted events while building a lump sum payout for themselves at the end of the policy term.”
Endowment policies are also a solution that is easy for prospective policy buyers to understand. Building on such understanding, insurance agents can also further educate and explain to their prospects the benefits of life insurance, which is important as the overall market is still at a nascent stage in Cambodia,“ Mr Rotha Chan, CEO, Manulife (Cambodia) Plc.
Endowment insurance in Cambodia has long-enduring popularity. It has always formed above 80% of total premium sales in Cambodia. In 2019, it formed 86.50% of total life insurance sales, in 2020 it formed 84%, in 2021 it formed 80% and in 2022 it rose to 80.4% of total sales, reported Khmer Times.