China Taiping Insurance: Seizing Opportunities and Taking the Initiative to Explore the Road of Insurance Reform and Development

Ten years ago, the China Pilot Free Trade Zone was unveiled and put into operation. This is the first officially established free trade zone in China, shouldering the responsibility of comprehensively deepening reform and further expanding opening up, exploring new ways, and accumulating new experience. Over the past decade, the pilot free trade zones have grown from scratch and from few to many, becoming an important platform for China's high-level opening-up and cooperation with the outside world.

The insurance industry, as a fundamental means of modern economic and social risk management, provides important financial guarantees and support for the high-quality development of free trade zones. For the past decade, adhering to the idea of "based on the platform of the Shanghai Free Trade Zone, accelerating the reform and innovation of the insurance industry", the insurance industry has persisted in seeking dividends and driving force from deepening reform and opening up, and further stimulating the development vitality of the industry.

Over the past decade, China Taiping Insurance has focused on the national strategic deployment of the Free Trade Zone, innovatively utilizing financial and insurance products and services, and using solid innovative measures to support the construction of the Free Trade Zone, achieving significant results and contributing to the construction and development of the Shanghai Free Trade Zone.

Rooted in the construction of free trade zones, early deployment and fast practice

Practicing national strategy, China Taipoli takes the lead. On September 29, 2013, on the day of the official listing of the Shanghai Pilot Free Trade Zone, China Taiping Property and Casualty Insurance Shanghai Pilot Free Trade Zone Branch was unveiled and established, becoming the first financial unit in the free trade zone to obtain a business license from the Administration for Industry and Commerce. For the past decade, China Taiping Property and Casualty Insurance Shanghai Branch, as a branch of China Taiping Group's main property insurance business, has always firmly implemented the decisions and deployments of the Party Central Committee and the State Council, and has always regarded serving the national strategy as an important mission of the company's business development. It has made early deployment and fast practice in rooting in the construction of free trade zones.

Since its establishment, China Taiping Insurance Group has given Taiping Property and Casualty Insurance a clear positioning as a separate free trade company. One is to create a platform for mechanism and system innovation: to connect with the operating models of mature international markets, and to pilot an important platform for operating mechanism and system innovation; The second is an innovative experimental field for new products and businesses; The third is the highland for cultivating new talents; The fourth is to connect the two domestic and overseas markets, combining the relevant work of Taiping Group's overseas institutions, property insurance, life insurance, assets, and online companies, and building a link of "one Taiping, a common home".

Taiping Property and Casualty Insurance Free Trade Division Company relies on the advantages of the Shanghai Free Trade Zone and, according to the positioning of the group company, regards offshore insurance business as the business development center and main line. In 2013, at the beginning of its establishment, China Taiping Property and Casualty Insurance Shanghai Pilot Free Trade Division Company took the lead in offshore insurance business. Based on customer needs and differences in underlying characteristics, it utilized advanced pricing models, a comprehensive risk control system, and a new management model to provide customized and personalized products and services to global customers, promoting the development of the financial industry in the free trade zone. As a result, this innovative project won the third prize of the 2014 Shanghai Financial Innovation Achievement Award.

From an innovative perspective, the offshore insurance business projects in the Shanghai Free Trade Zone mainly have seven aspects of innovation——

One is innovation in strategic positioning: abandoning the previous business model and management structure of property insurance companies, and focusing on the development of non auto insurance, with offshore business as the company's development focus. The second is innovation in product and service aspects: compared with other property insurance businesses, it truly achieves tailor-made services according to customer needs, realizes customized services, and quickly and efficiently customizes exclusive products and services for each domestic and foreign customer. The third is innovation in target customer positioning: positioning the main target customer group as high-quality foreign merchants and domestic enterprises with international business. The fourth is innovation in underwriting forms: In the past, domestic non car insurance mostly used ordinary co insurance and direct insurance forms, while in the insurance business of free trade zones, various new underwriting forms such as layered co insurance, single out co insurance, and layered reinsurance are gradually being explored. The fifth is the innovation of global insurance specialization and division of labor cooperation: compared to property insurance business, the offshore business carried out by free trade differentiation companies has deeper cooperation with international intermediaries and reinsurance institutions. Both parties or multiple parties learn from each other's strengths, complement each other, and achieve win-win results. The sixth is to achieve innovation in social management functions: offshore insurance business reduces operational risks for domestic and foreign cooperative merchants, and provides credit guarantees for Chinese enterprises through offshore insurance business, helping and supporting them to expand into international markets, truly reflecting the social management function of insurance. The seventh is innovation in business management models: The organizational forms, operational methods, team building, coordination mechanisms, risk prevention and control mechanisms established by the free trade differentiation company for offshore insurance business have practical innovation significance.

Industry insiders have stated that vigorously developing offshore insurance business has solved many problems encountered by Chinese enterprises in their internationalization, reduced overall social risks, opened up a new situation of mutual promotion, common development, and mutual benefit between the financial industry and other industries in the free trade zone. This is a positive exploration of the future development of the insurance industry and an important step in implementing the national strategy of "bringing in" and "going out".

From a macro perspective, offshore insurance business is of great significance for expanding service trade exports, enhancing the global competitiveness of China's insurance business, and supporting Chinese enterprises in overseas investment, which is in line with the national economic development and transformation strategy. From a micro perspective, offshore business plays an undeniable positive role in expanding the visibility and global influence of Chinese insurance institutions, improving credit ratings, meeting the needs of Chinese enterprises going global, and conducting overseas business.

Over the past decade, a series of groundbreaking policies have been launched in the Shanghai Pilot Free Trade Zone, and a series of groundbreaking practices have been carried out in depth. A large number of iconic achievements continue to emerge. Among them, Tai Bao's innovative figure and footprint have been left behind.

In August 2019, Shanghai established the only new pilot free trade zone in China in the Lingang area. On the occasion of the unveiling and establishment of the Lingang New Area, China Taiping Insurance immediately launched the establishment of the Lingang New Area Branch, promoting the strategic signing with the Lingang New Area Management Committee, and becoming the only insurance institution among the first 16 financial institutions to settle in the Lingang New Area.

The story of innovation continues to unfold in this vibrant land.

On March 5, 2021, China Taiping Property and Casualty Insurance Shanghai Branch issued the first digital RMB policy in Shanghai for the project company of Shanghai Lingang New Area Economic Development Co., Ltd. under Lingang Group, providing insurance protection for the first batch of construction projects in the Dishui Lake Financial Bay Financial Headquarters Cluster of 105 plots in Lingang New Area. It took the lead in forming an innovative cooperation model of "serving national strategy+building Dishui Lake Financial Bay+pilot digital RMB", achieving the first innovative practice of using digital RMB to serve national strategy.

Promoting and carrying out pilot projects for the application of digital RMB is not only one of the important tasks of Shanghai's 14th Five Year Plan, but also a key task in the Shanghai Municipal Government's work report for 2021. As two state-owned enterprises in Shanghai, Lingang Group is one of the most important development and construction entities in the Lingang New Area. China Taiping Insurance is one of the first financial institutions to layout the Lingang New Area. The two sides fully leverage the advantages of strong cooperation and innovatively combine the pilot application of digital RMB with the major national strategic construction of the Lingang New Area. This has important practical significance for Shanghai to create a financial development environment with international competitiveness and promote the construction of the Shanghai International Financial Center.

Big handed support for the development of Lingang New Area

Focusing on the construction of the Lingang New Area, China Taiping Insurance is fully committed, focusing on national strategies and macro industrial policies, actively leveraging the long-term and stable characteristics of insurance funds, and supporting the construction of major national projects.

As early as the end of 2019, China Taiping Life Insurance, a subsidiary of China Taiping Insurance, successfully participated in the targeted issuance project of Shanghai Lingang, a listed company under Shanghai Lingang Group, with a total investment of 2.68576 billion yuan.

This large-scale investment is undoubtedly an important event for the insurance industry to assist in the construction of the Lingang New Area. In August 2019, the Lingang New Area was officially unveiled, covering the areas south of the Dazhi River in Shanghai, east of Jinhui Port, as well as the areas south of Xiaoyangshan Island and Pudong International Airport. Following the principle of "overall planning and step-by-step implementation", we will first initiate the construction of approximately 120 square kilometers of areas such as Nanhui New City, Lingang Equipment Industry Zone, Xiaoyangshan Island, and the south side of Pudong Airport.

For the construction of the new Lingang area, China Taiping Insurance can be said to have fully invested. As soon as the new district was unveiled, the Chinese Taibao immediately took action. In order to better serve the construction of the Lingang New Area and further implement the requirements of China Pacific Property&Casualty Insurance Group's strategic transformation 2.0 "best customer experience, best business quality, strongest risk control ability, and becoming a leader in the healthy and stable development of the industry", China Pacific Property&Casualty Insurance Co., Ltd. Shanghai Nanhui Branch was officially renamed as China Pacific Property&Casualty Insurance Co., Ltd. Shanghai Pilot Free Trade Zone Lingang New Area Branch.

The renaming of this institution is a major strategic deployment of China Taiping Property and Casualty Insurance Shanghai Branch in response to the construction of the Lingang New Area, marking a substantial step taken by China Taiping in supporting the construction of the Lingang New Area.

Following closely behind, China Taiping Insurance signed a special cooperation agreement with Lingang Group at the Shanghai State owned Enterprise Entering Lingang New Area Connection and Exchange Conference, further deepening cooperation, benchmarking against the internationally recognized most competitive free trade park, adhering to the concept of high-quality development, increasing financial service innovation and institutional innovation, and jointly promoting the construction of the new area into a special economic function zone with more international market influence and competitiveness, creating a modern new city with industry city integration, open innovation, smart ecology, and livability. Specifically, China Taiping Insurance will leverage its advantages in investment freedom and support the construction of industry city integration; Give full play to the advantages of trade freedom and promote new international trade; Give full play to the advantages of transportation freedom and enhance the financial service functions of hub ports; Give full play to the advantage of financial freedom and promote the convenience of cross-border financial services; Fully participate in the construction of the Lingang New Area by leveraging the advantages of personnel's freedom of employment, attracting domestic and international high-end talents, and other five aspects.

It is also here that China Taiping Insurance innovates the entire process risk management model and practices the concept of people's urban construction with practical actions.

In order to explore and solve the pain points of the engineering supervision industry and assist in the high-quality development of the engineering construction field, under the guidance and support of the Lingang New Area Management Committee, China Taiping Insurance Group has been conducting project research, feasibility analysis, and scheme design work in collaboration with Shanghai Academy of Construction Sciences and China Railway Construction for over a year since June 2020. Through institutional innovation, model innovation, process innovation, and technological application innovation, the "Construction Engineering Full Process Risk Management" model has been launched, relying on the leading and experimental advantages of Lingang New Area in institutional reform, breaking through the supervision system that has been in operation for more than 30 years, and helping to officially pilot the institutional innovation of "canceling supervision" in the Lingang New Area.

With the progress of the pilot work and under the guidance of government departments, the pilot demonstration experience of the Lingang New Area will be further promoted to the Yangtze River Delta and even the whole country, providing theoretical and practical basis for the innovation and transformation of the management system in the field of national engineering construction, and effectively practicing the important concept of "people's cities built by the people, people's cities for the people".

For the new Lingang area, China Taiping Insurance's support measures continue to increase——

In December 2021, Taiping Insurance Group signed a strategic cooperation agreement with Lingang Management Committee to promote the construction of special economic function zones and modern new cities, exploring cooperation models in multiple fields such as financial innovation, technology insurance, diversified investment, and risk management.

In 2022, Taiping Life Insurance Shanghai Free Trade Zone Branch relocated to the Lingang New Area

Assist in the agglomeration and development of cutting-edge industries in technological innovation

Industrial focus is one of the important features of the Lingang New Area. By developing precision manufacturing, intelligent manufacturing, new energy, new materials, biopharmaceuticals, artificial intelligence and other fields, we will accelerate industrial upgrading and transformation, injecting new impetus into the economic development of Shanghai and the Yangtze River Delta region. The strategy of focusing on this industry has effectively improved the industrial agglomeration capacity and competitiveness of the new area, attracting more outstanding enterprises and projects to settle in the new area.

China Taiping Property and Casualty Insurance fully participates in the promotion of the construction of the Lingang New Area Science and Technology Insurance Innovation Leading Zone, and assists in the agglomeration and development of cutting-edge industries in science and technology innovation in the Lingang New Area.

In terms of integrated circuits, as a core member of the China Integrated Circuit Insurance Community, we have participated in the development of industry risk management standards and provided underwriting services to more than 80 enterprises including SMIC in the past three years, with a risk insurance coverage of over 480 billion yuan. At the same time, in terms of chip domestic substitution, we have innovatively launched a comprehensive liability insurance for domestic supply materials to assist in the localization process of the chip industry.

In the field of biopharmaceuticals, a series of products have been developed, including clinical trial liability insurance, life science insurance, and drug product liability insurance, providing full lifecycle product solutions to support the research and development of new drugs and specialty drugs, and supporting industrial development.

In terms of green and low-carbon, we have provided sufficient underwriting capacity support for green and low-carbon projects such as wind power, photovoltaics, and hydropower, and participated in underwriting the first offshore wind power demonstration project - the Shanghai Donghai Bridge offshore wind farm.

In terms of network security, participated in drafting the industry's "Network Security Service Specification", developed new products such as comprehensive network security insurance and anti DDOS attack insurance, and helped build a strong network security protection system.

Regarding the 14th Five Year Plan for the development of the Lingang New Area, China Taiping Insurance will strengthen the depth and breadth of the new round of cooperation in emerging finance with the Lingang New Area, focusing on new business formats such as financial technology, science and technology innovation finance, green finance, and talent development. At the same time, by listening to customer voices and needs, the relevant work team will form a special action plan to jointly embark on a new value journey of high-quality development with the Lingang New Area.

One is to leverage the innovative pilot field role of the Lingang New Area and use insurance measures to promote institutional innovation and reform.

China Taiping Insurance hopes to strengthen cooperation with Lingang New Area in building an intelligent new energy vehicle industry ecosystem. Based on its experience in intelligent connected vehicles in Suzhou Xiangcheng and other areas, and relying on the joint working group on intelligent connected vehicle insurance product research, China Taiping Insurance aims to promote the coordinated development and cross-border integration of intelligent vehicle related fields and technologies through the model of insurance coverage, car insurance first claim, and liability clearance, as well as the alliance blockchain technology for data sharing and privacy security under blockchain information security. This will provide key support for the rapid and healthy development of the intelligent connected vehicle industry and help Lingang New Area build a high ground for the development of intelligent connected vehicles.

The second is to focus on the national dual carbon strategy layout and jointly promote the sustainable development of Lingang ESG.

On the one hand, focusing on the planning of Lingang International Hydrogen Valley, design professional solutions to provide full lifecycle risk reduction services and a package of insurance protection for the hydrogen valley from the front-end construction period, the mid-range use process to the back-end transaction process; On the other hand, in response to the development stage of multiple industrial clusters settling in Lingang, corresponding product and service guarantee systems will be established through green innovation insurance measures such as soil insurance and water quality insurance, and commercial insurance measures will be used to mitigate the risk of ecological environment damage; At the same time, focusing on the construction process of the "sponge city" in the new area of Lingang, we will jointly explore new risk management and protection mechanisms for addressing climate change with Lingang, prioritize risk reduction in the city, use catastrophe insurance as a backup, and establish an innovative green finance model.

The third is to accelerate the construction of technology insurance innovation leading areas and create benchmark projects for technology insurance.

China Taiping Insurance will cooperate with the Lingang New Area to accelerate the construction of a technology insurance innovation leading zone, focusing on the specific risk protection needs of technology enterprises in the development of the "4+2+2" cutting-edge industrial system in the new area, and focusing on promoting technology insurance products such as the first major technology equipment insurance, biopharmaceutical insurance, intellectual property insurance, green insurance, network security insurance, tariff guarantee insurance, and high-end medical insurance for technology talents; Build innovative cases with benchmark demonstration effects around the construction of seven parks, including Dongfang Xingang and International Hydrogen Valley. And through the upcoming establishment of a professional technology insurance company in Lingang, explore innovative mechanisms for insurance investment in the technology industry, promote technological innovation and the transformation of the technology industry.

The fourth is to strengthen the risk protection of major infrastructure construction and promote the development of financial capital services for new areas and new cities.

China Taiping Insurance will focus on the development of cutting-edge industrial clusters in the implementation plan, provide professional services such as "insurance increment and risk reduction", and provide full process and comprehensive risk protection and management services for major infrastructure construction, covering material losses, safety production responsibilities, engineering deposit substitution, engineering quality assurance, etc., and work together to establish and improve the public safety protection system in the Lingang New Area; Through years of deep cultivation in the IDI business, a mature housing quality inspection and guarantee system has been formed, providing support for urban renewal in the Lingang area. At the same time, based on the development positioning of the new area, we will continue to support the construction of large-scale infrastructure projects such as energy, transportation, municipal and affordable housing through investment and financing models such as equity, debt, and asset support plans. We will study and promote the evaluation design of real estate investment trusts in the infrastructure field, play a role in capital guidance and driving, and jointly attract various types of funds to support the development of emerging industries in the new area and new city.

Looking towards the future, China Taiping Insurance will focus on the main responsibility and business of insurance, deepen product and service innovation, and effectively use the Shanghai Pilot Free Trade Zone as a "test field" and "window" for deepening the reform and opening up of the insurance industry. We will strive to explore replicable and promotable paths for insurance reform and development, and promote high-quality development of the free trade zone with high-level insurance financial services.