Foreign insurance firms ride reform wave
Foreign insurance brokers are riding on the wave of China’s further reform and opening-up policies after they won approval to widen the range of their business in the country.
Willis Insurance Brokers Co Ltd, a subsidiary of the London-based Willis Towers Watson Group, was the first to get the nod from the Shanghai bureau of the China Insurance Regulatory Commission to expand its business scope.
The firm’s business was previously confined to large-scale enterprises, but now it can serve companies of all sizes, as well as individuals.
Willis Insurance chief executive officer Xu Huizhi said that about 80 percent of its clients are state-owned companies. He believes that as China opens its door wider to the outside world, it offers plenty of room for foreign companies to bring more global expertize to the world’s second largest economy.
In developed markets, more than 90 percent of companies use insurance brokers, Xu said, but in China the rate is only 20-30 percent.
To better capture the opportunities in this round of opening-up in the financial sector, JLT Insurance Brokers Co Ltd (JLT China) has moved its headquarters from Guangzhou to Shanghai.
“It makes sense for us to do so, as Shanghai is building itself towards being an international financial hub and we will have closer cooperation with our partners here,” said JLT China chief Rong Honggang.
Rong said JLT would now target the rising number of affluent Chinese with tailor-made products.
“We are now making preparations for this new part of business,” he said.
JLT set up a new company this year devoted to offering risk management and insurance services for engineering enterprises.
President Xi Jinping announced at this year’s Boao Forum for Asia, a non-profit group hosting forums of regional leaders, that China will expand foreign players’ access ans speed up opening up the insurance industry.
In response to a call from the central government, the Shanghai Financial Services Office rolled out a slew of measures to boost the city’s financial reforms and opening-up this May. The plan seeks to raise foreign equity caps in the banking, securities and insurance industries and widen their business scopes.