China’s insurance industry posted strong growth of 6.5% in premium collections during the first eight months of 2009.
According to statistics released by the China Insurance Regulatory Commission, premiums collected by the insurance industry increased 6.5% to reach RMB 759.5 Billion during the first eight months of 2009 against the corresponding period a year ago (Jan-Aug 2008), as reported by
China Knowledge.
The total assets of Chinese insurance industry surged 21% year-on-year to RMB 3.68 Trillion in August 2009 but declined by 4% from RMB 3.8 Trillion in July 2009. This downfall in assets primarily accredited to 22% fall in the Shanghai Composite Index in August 2009.
Downtrend was not confined to industry’s assets segment but also engulfed investment segment which reported 4.35% slide from RMB 2.44 Trillion to RMB 2.34 Trillion in August, the first decline since March 2009.
Despite non performance of investment and assets segments, the Chinese insurance industry’s bank deposits flared up to RMB 985.2 Billion in August 2009 – an increase of 37.3% from August 2008 but lesser than July 2009 when they stood at RMB 1.03 Trillion.
China Life Insurance Co Ltd, the largest life insurance providing company, registered an impressive rise in its premium collections (unaudited) at RMB 210.7 Billion for the first eight months of this year. Following the footprints of China Life Insurance, the country’s second largest life insurer “Ping An Life Insurance (Group) Co.” recorded unaudited premium collections of RMB 118.88 Billion.
RNCOS, a leading market research firm, has attributed this stupendous growth in the Chinese insurance industry to several factors which include – ageing population, high saving rates and poor social security system. It has published a new research report “
Booming China Insurance Sector” that has closely studied the insurance sector and found that rising number of wealthy (affluent) people has played a critical role in spurring growth in property and casualty, health and auto insurance sectors.
China’s insurance companies remained upbeat even in adverse market conditions when the global financial crisis made foreign insurance companies bleed white.
While the industry drivers pumped up the Chinese insurance sector, three major risks are still pounding its growth prospects – channel management, management of non-life underwriting cycle, and climate changes and catastrophic events.
According to Research Analyst at
RNCOS, “The insurance industry in China has taken a giant leap forward over the recent years but it is still at the nascent stage of development when compared to regional peers such as Japan and South Korea. It has made mark for itself by becoming the fastest growing market in both relative and absolute terms. The market provides outstanding growth opportunities to industry players.”
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