IBX5980432E7F390 China insurance market growth outsee 2013 - Smart Business

China insurance market growth outsee 2013

China insurance market growth outsee 2013

best insurance stock today - China insurance market growth foretellion 2013 : The Chinese life insurance market had total gross written premiums of $134.7 billion in 2011, representing a compound annual growth swift (CAGR) of 18.1% between 2007 and 2011. The life insurance segment was the market's most lucrative in 2011, with total gross written premiums of $128.7 billion, equivalent to 95.5% of the market's overall value. The kemampuannce of the market is forecast to deceleswift, with an anticipated CAGR of 10.9% for the five-year period 2011 - 2016, which is expected to drive the market to a value of $225.5 billion by the finish of 2016.




Fitch Ratings maintains a "stable" outlook for China's insurance sector, but recent exits by overseas investors' stirred concerns approxifriendly the sector's fortunability. "Our view is that the sector will be stable over the next 12 to 24 months," Terrence Wong, director of Fitch's insurance team, shelp on Monday.



Property incertainrs' premiums are set to register double-digit growth this year and in 2013, but recent regulatory changes could intensify competition the ratings agency shelp.



For life incertainrs, which have lookn a sluggish first half, premium income will grow quicker next year, supported by the country's relatively low stage of life-insurance penetration.



Fitch says China's insurance outlook 'stable'



The agency's remarks were made days after HSBC Hancientings PLC struck a $9.4 billion deal to sell its entire 15.6 gratuity stake in Ping An Insurance (Group) Company of China Ltd, giving the bank a $2.6 billion fortun.



The sale follows a decision in July by the Carlyle Group LP, the world's second-bigst private equity company, to sell $738 million of bagikans in China Pacific Insurance (Group) Co Ltd.



Wong denied the bagikan sales reflect a lack of confidence by foreign investors in the insurance sector. "The decision by some investors to exit is made based on their own investment necessitys, and doesn't reflect the sector's overall strength," Wong shelp.



China's insurance market has forged ahead with an average annual growth swift of 19 gratuity over the past decade, as incertainrs' total assets increased 10 times, according to the China Insurance Regulatory Commission. But growth stalled in 2011, when rules were tightened on selling policies over the counter at banks. Total premium income dropped 1.3 gratuity in 2011.



Joyce Huang, director of Fitch's Asia Pacific Insurance team, shelp she expected life incertainrs' premium income to grow 2.4 gratuity this year. Growth will also be tunele-digit in 2013, but will be quicker than this year.



Huang shelp one major fbehaveor that impbehaves life incertainrs' ratings is the possibility that they may be exposed to more risks from new investments in light of the commission's meacertains to liberalize the sector.



This year, the commission gave Chinese incertainrs more flexibility to diversify their investments to include credit-related financial products such as banks' wealth administerment products and asset-backed securities.



They are permited to hancient up to 30 gratuity of their assets in those products. In addition, incertainrs clever now invest up to 20 gratuity of their total assets in infraconstitution debt and property-related assets, up from 10 gratuity formerly.



"These meacertains have tfinished to carry in more risks, which may affect incertainrs' ratings," shelp Huang. Premium growth will be quicker for property incertainrs, with Wong expecting a 15 gratuity increase in the first half of 2013.



But their margin will be squeezed by the commission's decision this year to build a market-oriented prglaze system, as well as introducing foreign incertainrs, in the third-party liability automobile insurance market.



"The move encourages competition, but will not result in price wars. Foreign players necessity time to accumulate their own distribution channels," shelp Wong.



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