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SIS International Research, February 2008:
Commercial/ Industrial Property Insurance Market in China
 
Overview
 
The Chinese economy is experiencing strong growth reaching $ 3.42 trillion USD in 2007, recording an average annual GDP growth rate above 10 percent. It is ranked as the fourth largest economy next to the US, Japan, and Germany.
 
The rapid development in the economy poses opportunities in the Chinese insurance market, which is considered as the largest untapped insurance market in the world. Several demographic, economic, and regulatory factors are driving the insurance industry to significantly increase over the past few years.
 
The Chinese insurance market is considered as the fastest growing market in th industry in both reaching $61.18 billion USD in 2007, with an annual CAGR of 15.33 percent.  This is due to increase in the in number of China’s ageing population, high savings rate, poor security systems, and the increasing number of affluent consumers specifically driving growth in property, casualty, automobile, and health insurance sectors.
 
Chinese life insurance products dominate market, with premiums increasing by 10.7 percent, primarily attributed to the changes in the health and pension systems encouraging consumers to spend more and decrease savings.  Non-life insurance (property and casualty) premiums also jumped by 22.6 percent, due to the economic expansion driving consumers to spend on insurance products.
 
Key Competitors
 
The Chinese insurance market has recently been liberalized allowing diverse ownership structure of insurance companies. In 2006, the total profit of all insurance companies in China reached $730 million USD with increased investment returns offsetting underwriting losses.
 
According to the Chinese Insurance Regulatory Commission (CIRC), there are about 100 insurance companies in China composed of 56 domestic insurance companies and 44 foreign insurance companies.  
 
The Chinese life and non-life insurance market have been dominated by the ex-state monopolies PICC and China Life.  However their market shares have been decreasing due to the increased competition, product restrictions, and entry of both domestic and foreign companies.  Moreover, Chinese insurers such as China Pacific and Huatai Insurance Company are looking for stock exchange listings to bring new capital and foreign expertise.
 
Currently, the largest foreign insurance companies are AIU (a subsidiary of AIG), Tokio Marine, and Mutsui Somimoto.
 
•    People’s Insurance Company of China
 
People’s Insurance Company of China is a state owned insurance company promoting its subsidiaries PICC Asset Management Company Limited and PICC Property and Casualty Limited.
The company is considered as the largest insurer of casualty insurance, licensed to provide all insurance products excluding life insurance.
In 2005, the company has entered a joint venture with Sumitomo Life Insurance Co. to establish the PICC Life Insurance Co. The company will sell insurance products including savings oriented endowment insurance policies.
 
 
    Product line
  1. •    Property Insurance
  2. ➢    Burglary Insurance
  3. ➢    "My Family' Homeowners Insurance
  4. ➢    Household Property Insurance
  5. ➢    Family Insurance
  6. ➢    Ocean Marine Transportation Cargo Insurance
  7. ➢    Overland Transportation Cargo Insurance
  8. ➢    Air Transportation Cargo Insurance
  9. ➢    Contractors All Risks lnsurance
  10. ➢    Erection All Risks Insurance
  11. ➢    Machinery Breakdown Insurance
  12. ➢    Processing with the Customers' Materials Insurance Package Other
  13. ➢    Hull Insurance
  14. ➢    Motor Vehicles Insurance
  15. ➢    Aviation Insurance
  16. ➢    Money Insurance
  17. ➢    Loss of Profits Insurance
  18. ➢    Checks Insurance
  19. ➢    Gas Users Insurance
  20. •    Liability Insurance
  21. ➢    Travel Agencies Liability Insurance
  22. ➢    Hotels Liability Insurance
  23. ➢    Ads Board/Neon Light Liability Insurance
  24. ➢    Exhibition Liability Insurance
  25. ➢    Employers' Liability Insurance & Additional Medical Expenses Cover
  26. ➢    Products Liability Insurance
  27. ➢    Public Liability Insurance
  28. ➢    Carriers' Liability Insurance
  29. ➢    Motor Vehicles' Third Party Liability Insurance
  30. ➢    Contractors' Third Party Liability Insurance
  31. ➢    Erection Third Party Liability Insurance
  32. •    Credit/Guarantee Insurance
  33. ➢    Export Credit Insrance
  34. ➢    Buyers'Credit Insurance
  35. ➢    Performance Bond Insurance
  36. ➢    Fidelity Guarantee Insurance
  37. ➢    Credit Card Insurance
  38. ➢    Baby-sitters'Fidelity Insurance
  39. •    Personal Accident Insurance
 
 
•    China Life Insurance
 
Headquartered in Beijing, China Life Insurance Company has been providing life insurance and annuity products. By the end of 2003, it became a public listed company allowing gains in terms of stock offers making it the second largest insurance company with $129 billion USD market value, in the world.
 
  1. Product line
  2. •    Individual Life Insurance
  3. •    Group Life Insurance
  4. •    Accident and Health Insurance (Short and Long Term)
  5. •    Asset Management
  6. •    Individual and Group Accident Policies
  7. •    Annuity Products
  8. •    Property and Casualty Insurance
 
 
•    American International Underwriters
 
Shanghai-based American International Underwriters is the insurance arm of American International Group Inc. focusing on property-casualty operations. It is offering a wide range or property-casualty products to both consumers and commercial clients.
The company is continuously launching new products and distribution initiatives capitalizing on global markets. It has entered emerging markets in key regions such as Asia, Latin America, and Central & Eastern Europe.
 
  1. Product line
  2. •    Commercial Products
  3. ➢    General Property Insurance
  4. ➢    Liability Insurance
  5. ➢    Marine Cargo
  6. ➢    Trade Credit
  7. ➢    Voluntary Employee Benefits
  8. ➢    Group Insurance
  9. ➢    Construction Engineering and Energy
  10. ➢    Financial Insurance
  11. ➢    Small Business Solutions
  12. •    Consumer Products
  13. ➢    Travel Insurance
  14. ➢    Individual Insurance
 
 
•    China United Property Insurance Co.
 
China United (Holding) Corp. Ltd. established the China United Property Insurance Co. in 2006. United Property Insurance will conduct a range of business activities within the insurance industry including property loss, liability, credit and guarantees, short-term health, casualty, and reinsurance of the above mentioned insurance businesses.
 
            Product line
  1. •    Enterprise Property Insurance
  2. •    Goods Transportation Insurance
  3. •    Vehicle Insurance
  4. •    Liability Insurance
  5. •    Credit Support
  6. •    Family and Individual Property Insurance
  7. •    Project Risk
  8. •    Comprehensive Insurance
 
 
•    China Pacific Property Insurance
 
 
China Pacific Insurance (Group) Co., Ltd, an investment and holding group with its head office in Shanghai, was developed in accordance with the stipulation on the separation of its property and life insurance sectors on the basis of the former China Pacific Insurance Co., Ltd. formed in April 1991.
 
Domestically, CPIC Group is the majority stake-holder of China Pacific Property Insurance Co., Ltd. and China Pacific Life Insurance Co., Ltd, two specialized insurance operations. At present, the two subsidiaries boast of a well-established service network with 5469 business branches across the country. Overseas, CPIC Group fully owns China Pacific (America) Services Inc. in the USA, China Pacific Insurance (H.K.) Co., Ltd. in Hong Kong, and representative offices in London and New York respectively. CPIC Group also formed a joint venture with ING called Pacific-Antai Life Insurance Co., Ltd.
 
CPIC ranks third in China's life insurance market, with a share of 9.5 percent, and second in the property insurance market, with a share of 11.6 percent.
 
  1. Product line
  2. •    Individual Offerings
  3. ➢    Accident Insurance Coverage
  4. ➢    Life Insurance
  5. ➢    Health Insurance
  6. •    Corporate Offerings
  7. ➢    Corporate Cars Insurance
  8. ➢    Personnel and Risk Management Insurance
  9. ➢    Goods Transportation Insurance
  10. ➢    Liability Insurance
  11. ➢    Construction Insurance
  12. ➢    Financial Properties Insurance
 
 
•    Tokio Marine
 
 The Tokio Marine and Fire Insurance Co. (HK) Ltd. [TMF(HK)] was established in Hong Kong as an operating arm of The Tokio Marine & Fire Insurance Co., Ltd. [TMF] in 1953. TMF(HK) offers the best quality products and services which were developed based on the highly-reputed products and services of TMF.
 
  1. Product line
  2. •    Property Insurance
  3. ➢    All Risks
  4. ➢    Fire
  5. ➢    Burglary
  6. ➢    Plate Glass
  7. ➢    Machinery All Risks
  8. ➢    Electronic Equipment
  9. ➢    Contractors All Risks
  10. ➢    Erection All Risks
  11. •    Accident and Health Insurance
  12. ➢    Group Medical
  13. ➢    Group Personal Accident
  14. •    Marine Cargo Insurance
  15. ➢    Marine Cargo
  16. ➢    Inland Transit
  17. •    Pecuniary Loss Insurance
  18. ➢    Private Car
  19. ➢    Commercial Vehicle
  20. •    Motor Insurance
  21. ➢    Business Interruption
  22. ➢    Fidelity Guarantee
  23. ➢    Money
  24. •    Liability Insurance
  25. ➢    Employees’ Compensation
  26. ➢    Public Liability
  27. •    Package Insurance
  28. ➢    Office Package
  29. ➢    Shop Package
 
 
•    Mutsui Somimoto
 
 
The Tokyo-based Mitsui-Sumitomo Insurance Company was formed in 2000 as a result of the equal-partner merger of The Sumitomo Marine & Fire Insurance Co., Ltd. and Mitsui Marine & Fire Insurance Co., Ltd.
 
•    Product line
•    Voluntary Automobile
•    Compulsory Automobile Liability Insurance
•    Fire
•    Personal Accident
•    Cargo and Transit
•    Hull
 
 
•    Allianz
 
 
Allianz Insurance Company Guangzhou Branch (AZCN) is the company’s first property insurance branch in China.   Operations started in February 2003, with the company offering the following insurance services: property, liability, marine, engineering and domestic credit insurance, as well as short-term health insurance and accident insurance for domestic and foreign clients within the province of Guangdong including Shenzhen. Nationwide, AZCN as well underwrites the LSCR risks (large scale commercial risk).
In 2007, the company’s gross premium written increased by 46% to RMB 54.64 million year-on-year in the first three months.
AZCN, in the future will introduce products and risk transfer solutions to meet client needs.  
  1. Product line
  2. •    Personal and Commercial
  3. ➢    Allianz Home Insurance
  4. ➢    Allianz Travel Insurance
  5. ➢    Allianz Health Insurance
  6. ➢    Allianz Accident Insurance