Future directions for foreign insurance companies in China 2015
Emerging regulatory changes provide greater opportunities for foreign insurers in mainland China.
Our new report suggests that a more liberalized regulatory environment is emerging in mainland China. Coupled with evolving joint venture and alliance structures, rising demand for health insurance and digital marketing expansion, the Chinese market is starting to provide better growth opportunities for foreign insurers.
- Domestic insurers continue to dominate
- Market share for foreign life insurers grew to 5.8%, and almost doubled to 2.2% for property and casualty insurers
- Health insurance premiums rose by more than 40%
- Internet and digital developments provide new opportunities for insurers
Major factors influencing growth
C-suite interviews with 30 foreign insurance companies identified the following factors as key drivers of growth:
- Introduction of the China Risk-Oriented Solvency System (C-ROSS)
- Extension of the Free Trade Zones (FTZs) model
- Regulatory changes to the internet channel with introduction of “Internet Plus”
- Joint venture and alliance structures with domestic insurers improving market share
Trends to look out for in the coming years
- Opportunities for growth in auto and health insurance sectors
- Foreign insurers building on their digital capabilities
- Talent shortages expected to impact growth
While domestic players are expected to continue to dominate the market, the outlook is optimistic for foreign players looking to gain a stronger foothold in the mainland China market.