Three foreign insurers have called off their plans to launch businesses in Myanmar, due to a last-minute change in regulations by the government.
Thailand’s Muang Thai Insurance and Muang Thai Life Assurance, and South Korea's DB Insurance are no longer expanding into the emerging insurance market and were unable to finalise deals with local partners, a report by Nikkei said, citing an industry insider.
Recently, the Burmese government gave approval for six foreign insurers to form joint ventures. Nine companies, including the three that cancelled their plans, submitted applications.
According to the report, until around April, the government seemed to imply that the foreign companies were allowed to buy outstanding shares in local insurers to create joint ventures, the industry insiders. However, the government changed its tune, saying that foreign players could only buy newly issued shares.
The change caused some local partners, who were looking forward to making money from selling stocks, to become hesitant, thus leading to their deals breaking down.
Last week, the Ministry of Planning and Finance announced that Japanese insurers Sompo Holdings, Mitsui Sumitomo Insurance and Tokio Marine Holdings were given approval to set up joint ventures for nonlife insurance. Meanwhile, Japan's Nippon Life Insurance and Taiyo Life Insurance, as well as Thailand's Thai Life Insurance, were given the go signal to enter the life insurance market.