A view of German insurer Allianz's office building in Berlin, Germany. File photo: VCG

Insurance firms, especially foreign ones that are prepared to expand in China amid the country's opening-up efforts this year, will likely gain share in the world's largest market, as the blow from the novel coronavirus pneumonia (NCP) has inspired many Chinese people to purchase insurance, industry insiders said.

Both Chinese people's willingness and awareness of the benefits of purchasing insurance will get a boost due to the outbreak of the virus, Wang Jun, chief economist at Zhengzhou-based Zhongyuan Bank, told the Global Times. "Currently, domestic people's awareness of insurance is relatively low compared with other markets in the world."

A Beijing-based insurance agent who works for a world-leading insurance firm told the Global Times on Sunday that during the outbreak of the NCP, she had more consultations with potential customers. She had one or two new potential customers almost every day during the past two weeks.

"Although treatment expenses for the NCP will be covered by the government, people who come to me want to buy a double guarantee for themselves and family members, while before the crisis, most of them never thought of purchasing an insurance product before," the agent, who asked to remain anonymous, said.

The increasing demand is similar to 2003 when SARS broke out. The year-on-year growth rates of health insurance single-month premiums in May 2003 was 309.3 percent, the growth rate in June was 265.3 percent, and it was 157.75 percent in July, according to domestic news site yicai.com.

The Global Times found that more than 1.6 million people have "bought" an  insurance policy for NCP on a Tencent-owned internet insurance platform. The product, named the NCP security fund, which was co-developed by Chinese internet firm Tencent and domestic insurance firm Taikang, will offer 10,000 yuan ($1428.24) to the insured if they are diagnosed as critical NCP patients, and will offer 50,000 yuan to the beneficiaries of those who die from the virus. 

The product is totally free, and people only need to register their phones, names and ID cards to get it, according to its introduction.

"All these people who registered for the product could become potential customers, and that could be cheering news for the long-term development of the industry, and also mean opportunities for foreign insurance firms that expand in China this year," an industry insider surnamed Yu, who's been in the industry for five years, told the Global Times on Sunday.

The Allianz (China) Insurance Holding Co, also China's first wholly foreign-owned insurance holding company to benefit from China's opening-up measures, which was  set up weeks ago, has just announced the establishment of an emergency response fund to support China's fight against the coronavirus epidemic, the company said in a statement it sent to the Global Times.

"Moving forward, the Holding Company will provide a strong platform from which to develop our business in China, fast and effectively. It will allow us to improve efficiencies, develop synergies with our other businesses, and position us to maximize the opening-up of the Chinese economy," said the company.

"We are fully committed to China and will continue to watch the situation closely, providing ongoing support and assistance where it is needed," it said.

Over the past two years, China has introduced 34 opening-up policies in the banking and insurance sectors, including expanding foreign-invested firms' business scope and easing market access, said the China Banking and Insurance Regulatory Commission.

In 2019, 11 foreign-funded insurance companies were approved to increase their capital in China, and 20 provincial branches of 15 foreign-funded insurance companies were approved for the establishment in the country, according to a report from the Xinhua News Agency.

 "Foreign insurance firms, which have been engaged in global markets for years and have mature resources and high-quality services, could provide more diversified insurance products for Chinese customers," Dong Dengxin, director of the Finance and Securities Institute at Wuhan University of Science and Technology, told the Global Times on Sunday.

"They also have certain advantages over their Chinese counterparts that provided homogenized products over the past years," Dong said.


Newspaper headline: NCP outbreak could mean opportunities