First Life Insurance Joint Venture to Operate in China

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Last updated at: (Beijing Time) Wednesday, January 23, 2002

First Life Insurance Joint Venture to Operate in China

Generali China Life Insurance, established by the Italy-based Assicurazioni Generali and the China Petroleum Finance Company (CPFC), and the first insurance joint venture licensed by the China Insurance Regulatory Commission (CIRC) after China's WTO entry, will start operations in Guangzhou this month, a CIRC official said Tuesday.

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Generali China Life Insurance, the first insurance joint venture licensed by the China Insurance Regulatory Commission (CIRC) after China's entry into the World Trade Organization, will start operations in Guangzhou this month, a CIRC official said Tuesday.

The joint venture between the Italy-based Assicurazioni Generali and the China Petroleum Finance Company (CPFC), the only financial subsidiary of the China National Petroleum Corporation, has registered assets of 20 million yuan (24 million U.S. dollars) and more than 500 insurance sales agents.

Generali and CPFC

Assicurazioni Generali is one of a few foreign insurance businesses that have been permitted to operate in China. It has been seeking competitive local partners to expand its business in China over the past few years.

The company has already been involved in some technological and financial cooperation projects in China, including offering reinsurance services for large aerospace projects.

Assicurazioni Generali is ranked among the top 20 insurance groups in the world and the third in Europe, operating in 50 countries and regions, including Japan, Hong Kong and the Philippines in Asia.

The CPFC was founded in 1995. The company increased its total assets to 7.025 billion U.S. dollars and made a profit of 56 million U.S. dollars in 2000, ranking first among the 71 financial firms in China.

Insurance market to open gradually

Experts say that after China enters the WTO, its insurance market will be gradually opened wider to the outside world and will become one of the world's top ten markets in 20 years.

China has a population of nearly 1.3 billion. In 2001, its insurance industry had a total premium of 210.94 billion yuan (25.4 billion U.S. dollars), up 32.19 percent from the previous year.

Life insurance accounted for 67.51 percent of the total to top 140 billion yuan (16.87 billion U.S. dollars), up 42.76 percent.

China's insurance industry facing WTO entry

China Preparing to Further Open Insurance Market

During its negotiations for WTO membership, China made major commitments to allow non-life insurers, life insurers and foreign insurance firms to set up branches or solely-funded sub-firms and provide different services to the Chinese enterprises and Chinese people step by step. China also gave the timetable of the opening.

Analysis: WTO to Bring Fair Play to China's Insurance Industry

With its entry into the World Trade Organization (WTO), China's huge domestic market is opened up, and it would be a fair play with domestic life insurance companies against joint venture companies, according to Victor Apps, executive vice president and general manager for Asia of Manulife Financial.

CEOs from China's Top Four Insurance Companies Talk about Strategies

China's Insurance Regulatory Committee recently confirmed its basic commitments for quickening opening-up pace after China's entry into the WTO as competition from foreign insurance companies is close at hand. When interviewed by the reporter of Economic Daily, CEOs from China's top four insurance companies aired their views in response to challenges brought by China's entry into the WTO.

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