Several foreign insurance brokers are looking to expand their presence in China to cash in on opportunities arising from the gradual opening up of the country’s insurance sector and the ambitious Belt and Road Initiative, sources said.
Aon Corp, the United Kingdom-based global risk management and reinsurance solution provider, has already reaped the rewards of such collaboration through Aon-COFCO, its 2003 joint venture with Chinese State-owned grains and food conglomerate COFCO. The venture is now a leading provider of risk management, insurance and reinsurance brokerage services in China.
At the Boao Forum last month, Yi Gang, governor of the People’s Bank of China, the central bank, had indicated that China was planning to introduce more measures to further open its financial market, including easier market access to foreign firms and a level playing field vis-a-vis domestic firms, as well as allowing qualified foreign investors to operate insurance brokerages.
“Widening the business scope of foreign insurance brokers will help improve the domestic brokerage market as the foreign companies will introduce their experiences into China and enhance the cooperation between the domestic and foreign companies, “said Zhu Junsheng, an insurance researcher at the Development Research Center of the State Council
“Measures that enable the same treatment will help foreign brokers to expand business to more small and medium-sized enterprises and even to individual citizens,” said Wu Qing, general manager of Aon-COFCO.
“The insurance brokerage business started in China in 2000 and the concept of brokers in insurance is being gradually accepted by society and enterprises,” said Wu. “For a long time, insurance has been a seller’s market in China, but after it was opened to foreign brokers, we have been able to offer detailed analysis for clients and help them find suitable insurers.”
Wu said foreign insurance brokerages can also offer a helping hand to meet the shortages in insurance services especially for Chinese entities investing in economies involved in the Belt and Road Initiative.