Shanghai's situation atypical
The optimistic voices Chen Wenhui heard may be limited to Shanghai.
According to business data from CIRC Shanghai Bureau, the gross premium receipts in Shanghai during the first 2 months this year amount to 13.98 billion yuan (US$2.047 billion) in which property insurance accounts for 2.87 billion (US$420.20 million) and life insurance 11.11 billion (US$1.627 billion). The three figures represent respective growth of 10.3 percent, 1.1 percent and 13 percent. Albeit moderate, the numbers reflect the industry's sound development amid the financial crisis.
However, in other provinces, the insurance companies have started to feel downward pressure.
For example, Beijing and Guangdong, also two major cities for insurance companies, both report negative growth in January and February this year.
Beijing's premium receipts during the period amount to 10.59 billion yuan (US$1.55 billion), contributed by the property's 2.54 billion (US$371.89 million) and life's 8.05 billion yuan (US$1.18 billion). These three figures represent respective growth or shrinkage of -1.94 percent, 14.4 percent and -6.2 percent. In Guangdong, total premium receipts reached 17.66 billion yuan (US$2.59 billion), a drop of 130 million yuan (US$19.03 million) year on year.
In addition to these two cities, reductions have also been seen in Zhejiang Province, evidenced by its 17.2 percent decrease in premium receipts.
Chairman of the ICRC Wu Dingfu recently confirmed in Hainan that the country's insurance industry is indeed affected by the international financial crisis. And he also urged companies to optimize their business structure and raise their performance while avoiding market risks, especially the systematic risks that involve interest fluctuation, inflation and base risk.
Concerning Shanghai's surplus, a senior official who did not attend the meeting reveals that some companies like Dragon Life and Guohua Life are still vending their short-term high-return insurance package, and this is helping to boost business figures. In additional, Ping An China's universal insurance is also better received in Shanghai than in other places, and is also making a contribution to the growth.
"CRIC's analysis of the situation echoes our own," said an official from Sino Life Shanghai Company. "We plan to continue with our policy of low profile and limited expansion."
(China.org.cn by Maverick Chen, March 31, 2009)
