Best’s Market Segment Report: AM Best Maintains Stable Outlook on China’s Non-Life Insurance Segment
AM Best has maintained its stable outlook on China’s non-life insurance segment, citing several factors that include a supportive regulatory environment, increased health insurance awareness and strong growth potential in the electric vehicle insurance market.
The Best’s Market Segment Report, “Market Segment Outlook:
Additionally, premium in the health insurance segment has experienced notable growth, supported primarily by high-deductible, high-limit, medical reimbursement policies, often referred to as “million-yuan policies.” Insurers also have introduced new products with enhanced coverage to meet evolving customer needs, such as tailored protection for subgroups of the population and changes in claims payment structures.
“China’s rapidly aging population is driving significant demand for insurance, and these products have gained significant traction as they offer supplementary coverage for expensive medical procedures and treatments not fully covered by social medical insurance,” said
The rapid adoption and strong growth in electric vehicle (EV) sales have elevated the demand for EV motor insurance. According to the report, many insurers have been cautious in underwriting EV motor insurance due to higher loss frequency and claims costs, but China’s regulator has given insurers greater flexibility to adjust rates based on differentiated customer risk profiles. This change should encourage insurers to conduct a more-detailed analysis to better assess customer risks.
“AM Best expects large insurers to maintain their competitive advantage by leveraging more-abundant data, greater bargaining power in distribution networks and advanced actuarial analytics for more-accurate pricing and risk differentiation,” said
China’s economic momentum remains subdued, with consumer demand challenged by an ongoing real estate slump. A prolonged economic slowdown in
To access the full copy of this report, please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=346770.
AM Best will participate at the upcoming East Asian Insurance Congress’ (EAIC)
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Source: AM Best
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