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Chinese state-owned People’s Insurance Company of China (PICC) announced today that it plans to open its finance unit in a bid to grow sales and expand partnerships with some of China’s prominent Internet finance companies. The entity intends to leverage its capital strength to tap the growing the particular space in China.
Executive Director at the company’s Hong Kong listed subsidiary, PICC Property and Casualty, Wang He stated: “A total of one billion yuan (HK$ 1.21 billion) worth of premiums was written from its mobile terminals in the first six months of this year, indicating a booming development of the Internet finance industry as well as the huge potential.”
PICC has previously made efforts to improve its car insurance business by building a separate Internet division. It has also collaborated with e-commerce companies such as Alibaba Group Holding Ltd Ant Financial, TENCENT HOLDINGS ADR, and JD.Com Inc. (ADR). Additionally, the management is looking forward to enter into a cooperation program with Chinese Internet Service Provider, Qihoo 360 Technology Co Ltd.
PICC reported net profit of 18.03 billion yuan for the first half of 2015 (1H15) on the back of increasing sales, especially from telemarketing and online sales channels.. Also, revenues from written premiums has increased 12% YoY to 231.47 billion yuan.
PICC is also considering to set up a re-insurance company, a pension management startup, and a third-party payment entity in 2H15.
The Insurance company's foray into the Internet finance space signifies the growth potential of the market. China is considered the next key growth market after the US, and its impact can be judged by the fact that the current recession in the country has caused a widespread decline across global stock markets.
(Source: China Business News)