Insurer Sun Life Vietnam fined for violations, suspended from signing new contracts for 2.5 months

Sun Life Vietnam, a subsidiary of Canada-based Sun Life Assurance Company, has been fined VND130 million ($5,030) for non-compliance with some universal life insurance product-related regulations.

Specifically, the insurer did not comply with the rules, terms and premium structure of a universal life insurance product featuring a three-year premium payment and 10-year coverage, per Vietnam Ministry of Finance approval.

According to a decision issued on December 12, 2024 by the Insurance Supervisory Authority under the ministry, Sun Life also got a warning for "providing inaccurate, imcomplete and unclear sales illustrations" for the product, thereby "failing to support customers in making right decisions".

In addition to the financial penalty, Sun Life has been temporarily suspended from signing new insurance contracts for 2.5 months, according to a recent statement of the authority.

The company is further required to deploy measures to remedy the consequences, including reinstating full compliance with the approved rules, terms, and premium structure of the product.

Sun Life Vietnam reported a loss of VND868 billion ($3.36 million) in 2024, marking the 11th consecutive year of losses since its entry into Vietnam in 2013.

According to its audited financial statement, the company posted insurance premiums of VND3.4 trillion ($131.4 million) last year, down 18.8% year-on-year.

Meanwhile, costs for insurance business activities slightly rose to VND1.99 trillion ($77.27 million), and total compensation and insurance payouts rose nearly 35% year-on-year to approximately VND1.61 trillion ($62.2 million).

Revenue declined while costs remained high, causing Sun Life Vietnam’s gross profit from insurance business activities to fall 66% to VND1.29 trillion ($50.06 million) in 2024. As of the end of 2024, the company had accumulated losses of nearly VND6.36 trillion ($246 million) and recorded owner’s equity of VND11.58 trillion ($447.6 million).

Sun Life Vietnam’s total assets stood at VND20.79 trillion ($803.83 million), with long-term investments of VND6.96 trillion ($269.15 million) and liabilities of VND9.21 trillion ($356.17 million) as of end-2024.

Headquartered in Ho Chi Minh City, Sun Life Vietnam operates two branches, 25 sales points, and 24 agency offices. With a workforce of 590 employees, the company spent VND421 billion ($16.27 million) on salaries and VND943 billion in agent bonuses in 2024.