Top Biz News

Insurance premiums on steady rise

By Sun Min (China Daily)
Updated: 2006-07-21 08:56

Chinese insurers are expected to post higher first-six-month earnings next month, analysts said.

Increasingly, regulators have been allowing investment in high-yield assets. Some were recently permitted to invest in infrastructure projects, such as railways, for the first time.

CIRC Chairman Wu Dingfu said last month that insurance companies in China would be able to invest as much as 15 per cent of their assets in overseas markets.

Insurance funds will also be allowed to invest in banks equities, either listed or non-listed.

CIRC statistics indicated that insurance assets in China totalled 1.7 trillion yuan (US$212.5 billion) by the end of June. And 1 trillion yuan (US$125 billion) of the assets were applied to investments, while only 566.7 billion yuan (US$70.8 billion) were put in bank deposits.

Foreign-funded life insurers altogether had a premium income of 10.9 billion yuan (US$1.4 billion) in the first six months compared to 25.6 billion yuan (US$3.2 billion) in the same period a year ago, according to regulator's statistics.

The decline was largely because of a big base figure in 2005 after Generali China Life Insurance won a US$2.4 billion group life insurance contract with PetroChina in March 2005.

AIA (American International Assurance) was the top foreign player in the first six months. Its life insurance premiums rose 5 per cent to 3.2 billion yuan (US$400 million) in the period, up 6.7 per cent from a year ago.