Trio Moves to Breathe Life into Insurance SectorA trio of life insurance companies has received licences to offer new services in a move to inspire the current stagnant life insurance market.The Sino-Canadian joint venture Manulife-Sinochem Life Insurance Co, the China Life Co and the American International Assurance (AIA) Co announced last week that they had received approval by the Chinese Insurance Regulatory Commission (CIRC) - the country's insurance industry watchdog - to sell the new products, and Manulife-Sinochem said it has already begun to sell insurance policies of the new services. AIA said its two participating packages will be available in the next few weeks, and China Life said it is reviewing the detailed plans of the packages. The launch of these policies, which are already common practice in the global life insurance market, is believed to be another major breakthrough in expanding China's life insurance market. The latter half of 1999 brought about slumps in the domestic life insurance market thanks to premium increases generated by government interest cuts. "Customer can surely have more choices while seeking better returns from the available insurance plans, and the new policies are efficient investment channel for policy-holders," said Raymond Chan, general manager of the Shanghai-based Manulife-Sinochem Life Insurance Co. Currently, participating products have comprised some 80 per cent of the market share in the global life insurance market. Chan said the new policies that the company plans to sell should be key in luring customers because current policy-holders will be able to earn annual dividends from the insurance companies. "I am confident that the dividends, coupled with insurance plans' traditional function of protection and savings, would win the customers' favour under the current low interest rate environment compared with other policies," Chan said. But he stressed that the dividends - which will be allocated based on the insurance firms' annual achievements - would not be secured because of the expected market fluctuations. "Approval of such products would be a very good stimulus to our business operations here," said Elaine Wong, deputy general manager of Manulife-Sinochem, who promised that her company is expected to launch more participating products catering to the market reaction. |
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