Online insurance company approved (2)

Ma Mingzhe, chairman of Ping An, told a press conference on August 24, 2012 that the new venture would aim to take advantage of Tencent's and Alibaba's large number of Internet users, and develop a new sales channel for Ping An's insurance products.

"With the increasing number of Internet users and the booming e-commerce market in China, it is important for insurance companies to follow the trend and develop online sales channels," Feng Po, an analyst at financial consultancy China Venture, told the Global Times Tuesday.

Some insurance companies have already tried to sell insurance products online. For example, Guohua Life, a small Shanghai-based life insurance company, sold 116 million yuan ($18.6 million) worth of insurance products within four days in December on taobao.com, Alibaba's customer-to-customer e-commerce platform.

"Alibaba and Tencent are leaders in e-commerce and social networking sectors, so the launch of the online insurance venture will have an impact on traditional sales channels of insurance products such as banks," Zhang Meng, an analyst with IT research firm Analysys International, said in a research note Tuesday.

Feng warned that selling insurance online could also bring potential problems such as leakage of personal information and possible problems in after-sale services. Further regulations related to online insurance are likely to be released by the CIRC, he noted.

"The online channel's impact on traditional channels will not be big in the short term, as people need time to accept the new method of buying insurance," he said.