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Overseas Insurers Enhances Presence in China
With China's entering the World Trade Organization (WTO) approaching, overseas-funded insurers in China are racking their brains to work out tactics to join the intense competition they will have to face in the Chinese market.
Allianz Dazhong Life Insurance Co.,Ltd., a Sino-German venture, has recently presented another three new services in Shanghai, including the "Participating Whole Life Insurance," the "Dread Disease Benefit Assurance" and a new type of accident insurance.
Before that, this company had kept introducing a new insurance service each month to the Chinese clients.
After initiating three profit-sharing services last year, the Sino-French funded AXA-Minmetals Assurance Co., Ltd. started to market a par annuity insurance service early this year, which is said to be the first life profit-sharing annuity insurance for individuals in the Shanghai market.
Zhonghong Life Insurance Co.,Ltd., as the first Sino-overseas insurance venture to land on Chinese market, has also come up with a new service titled "investment rider," which closely combines the profit-sharing and unit-link insurance together, and has drawn wide public attention.
According to sources inside the insurance circle, the overseas- funded insurers initiating more new services suggests they are speeding up preparation for the impending competition in the Chinese market. "China's entry into the WTO will not only promise a more open market but also suggest severer competition," said Dr.Von Canstein, general manager of Allianz Dazhong. "We are providing more services that could better fit into the needs of Chinese clients so as to win more market share," Canstein noted.
Since American International Assurance Co., Ltd. made its debut in the Chinese market in 1992, quite a few world famous insurance firms have come to China to set up their subsidiaries or develop joint ventures.
So far, the overseas-funded insurance companies running businesses in China have outnumbered their Chinese counterparts.
In Shanghai, the city boasting the most developed insurance market nationwide, 12 overseas-funded insurance companies have set up shop, most of which are from America, Germany and France.
Despite the fact that they can only run business in certain areas with limited insurance coverage, those overseas-funded companies, taking advantage of comparatively advanced operating skills and rich experience, are growing into tough rivals against Chinese insurance companies.
According to figures released by Shanghai Insurance Supervisory Office, the overseas-funded insurers in Shanghai last year reported 10.6 billion yuan (about US$128 million) in life insurance premium and 210 million yuan (about US$25 million) in property insurance premium, and their aggregated premium made up 13 percent of the city's total, marking an increase of three percentage points over 1999.
In addition to expanding their insurance coverage, the overseas- funded companies have tried every possible means to improve their popularity.
Many of them have cooperated with Chinese colleges to open courses on insurance, to help China cultivate specialized talents in this sector.
AXA-Minmetals, as well as many other companies, has set up its own website with an end to catch more citizens' sights.
Soon after the Shanghai Municipal Government released the Program on Shanghai Medical Insurance Reform, Allianz Dazhong set up a "Medical Account Calculating System" at its website, through which the policyholders may check their remaining sum conveniently.
At the US Asia Society's 11th annual corporate conference in Asia held last May in Shanghai, Chinese Premier Zhu Rongji expressed in his keynote speech that China will open its insurance sector wider to overseas insurers as the process of China's accession to the WTO is picking up speed.
In late 2000, China Insurance Regulatory Commission authorized another ll overseas-funded insurance companies to open business in China, which included John Hancock Tianan Life Insurance Co., Ltd a Sino-U.S. venture that has just come into operation in Shanghai. "We are fully prepared to meet the challenges as well as opportunities that are supposed to come along with China's entry into WTO," said Anthony E. Higgins general manager of John Hancock Tianan, the latest newcomer to the Chinese insurance market.
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