|
Home>News Center>Bizchina | |
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||
|
|
Insurance company follows group trend New China Life Insurance Co, China's fourth largest life insurer, will soon be restructured into an insurance group. The group, New China Insurance Holding Co Ltd, which will own New China Life, is expected to receive regulatory approval shortly after the Spring Festival, or Chinese Lunar New Year which falls on February 9, the life insurer said. The holding company is currently being put together, after obtaining approval from the China Insurance Regulatory Commission (CIRC) to start preparations last September. The company will "hopefully pass regulatory examinations and be unveiled after the Spring Festival," Guan Guoliang, chairman of New China Life said in a statement. New China Insurance Holding will also own three insurance intermediaries the life insurer set up over the past two years - New China Insurance Brokerage Co, Chongqing New China Insurance Agency Co and Kunming New China Insurance Agency Co. Also under the umbrella of the holding firm are three insurance companies specializing in property, pensions and health insurance respectively, as well as an asset management firm. The four companies are under construction, and pending regulatory approval, officials with the life insurer said. The officials declined to offer further details on the restructure. The insurance authorities are encouraging qualified Chinese insurers to reform into insurance groups as a way to sharpen edges in the face of growing foreign competition. As it stands, Chinese insurance firms are not allowed to run life and property insurance businesses concurrently. By restructuring into groups, they can branch out into all major areas of the industry, including those that are newly opened to foreign insurers - pension and health insurance. China lifted nearly all business and geographical restrictions on foreign insurance companies towards the end of last year, honouring its commitments made upon accession to the World Trade Organization three years ago. Another company moving along a similar path is Huatai Insurance, a leading property insurer that now owns life insurance and asset management subsidiaries. New China Life also said on Wednesday its underwriting business continued to grow rapidly last year, while substantial improvements were achieved in readjusting its product mix. The life insurer garnered 18.9 billion yuan (US$2.3 billion) in premiums last year, up 9.5 per cent year-on-year, outperforming the industry's 7.2 per cent growth rate, it said. The company remained the fourth largest life insurer last year, with a 5.8 per cent market share. China's life insurance industry slackened its pace significantly last year, with many leading players trimming lossmaking areas of their businesses - particularly five-year single-premium products sold at banks - to shore up profitability. In Beijing, where competition is especially tough, life insurers saw their premiums shrink by 7 per cent in 2004. While maintaining rapid growth, New China Life said it managed to increase the amount of profitable products it has on offer. First-year premiums accounted for 85.3 per cent of individual insurance last year, up 38 percentage points from 2003; ten-year products accounted for 65 per cent of the bancassurance business, doubling last year's figure. The company issued 1.35 billion yuan (US$162 million) in subordinated bonds at the end of last year, which not only brought its solvency margin up to regulatory requirements, but made the company's capital structure "more stable and optimized," it said. The insurance authorities issued rules more than a year ago to allow insurers to issue subordinated bonds, which rank behind other liabilities in terms of claims on issuer assets, and calculate the proceeds as capital to help replenish their capital base. New China Life's total assets stood at 39.8 billion yuan (US$4.8 billion) at the end of last year, up 63.2 per cent from a year earlier. |
|
|
|
|
|||||||||||||||||||||||||
|
|
|
|
||||||||||||||||||||||||||||
