Further progress has been made in the international reinsurance board, with foreign insurance companies taking the "green channel" within the group in order to catch up with the first batch
Recently, during the media research event "Sailing New Journey Insurance Helps High Quality Development of Shanghai Free Trade Zone Lingang New Area" held by the Shanghai Insurance Industry Association and Insurance Society, the reporter learned that Ping An Property and Casualty Insurance has completed the construction of the Shanghai Reinsurance Operation Center in accordance with the preparation standards, and Ansheng Tianping Property and Casualty Insurance plans to effectively introduce mature reinsurance technology and products in the future.
Steadily advancing
On August 14th, the State Administration for Financial Regulation approved the establishment of Shanghai Reinsurance Operation Centers by seven insurance companies. This is one of the first batch of approved reinsurance operation centers, marking another substantial step forward for Shanghai Reinsurance's "international board". The first batch of 7 approved companies are Guoren Property&Casualty Insurance, Sunshine Property&Casualty Insurance, Sumitomo Mitsui Marine, China United Property&Casualty Insurance, Ping An Property&Casualty Insurance, Zijin Property&Casualty Insurance, and Ansheng Tianping Property&Casualty Insurance.
Back in June of this year, at the Lujiazui Forum, the Shanghai Banking and Insurance Regulatory Bureau and the Shanghai Local Financial Supervision Bureau jointly released the Implementation Rules on Accelerating the Construction of the Shanghai International Reinsurance Center, opening a global reinsurance entry business trading market in Shanghai. The Implementation Rules specify the guiding ideology, construction goals, important tasks, and promotion path of the Shanghai International Reinsurance Center.
The reinsurance market is a relatively special market that mainly allocates risks to insurance companies. Sumitomo Mitsui's Managing Director, Kan Kuangyan, previously stated that when a real disaster or catastrophe occurs, it is difficult for an insurance company to underwrite and requires the strength of the industry. In this process, it is necessary to share technology, data, and underwriting capabilities. A platform that can do this is very important. The international board of reinsurance is such a platform.
"The domestic and foreign reinsurance industry generally believes that this is a significant opportunity for China's reinsurance industry to reform, develop, and open up to the outside world," said Xu Weina, Senior Manager of the Reinsurance Department of Ping An Property and Casualty Insurance Co., Ltd.
Major opportunities
Although China is currently the second largest insurance market in the world, there is still a nearly four fold reinsurance trade deficit. "The premium we distribute is about four times the premium we receive," Xu Weina said. Through the construction of a reinsurance trading center, on the one hand, it is conducive to solving the trade deficit, and on the other hand, it can also integrate the insurance market, including products, regions, and vertical depth, into a higher level of internationalization.
In Xu Weina's view, Shanghai has its own unique advantages compared to reinsurance center cities such as London, Bermuda, and Singapore.
One is that as an international financial center city, it gathers numerous domestic and foreign financial institutions, as well as insurance and reinsurance institutions, and has a group of high-end insurance and reinsurance talents with world-class knowledge structure, international perspective and capabilities. The financial market system and talent reserves are relatively complete;
The second is to rely on the second largest insurance market in the world, and the large and dynamic domestic primary insurance market is an important support. The Chinese insurance market has developed rapidly in recent years, with active insurance capital. There is an urgent need to achieve balanced development and better operating profits for insurance companies through product diversification, regional diversification, and vertical diversification;
Thirdly, the Shanghai Lingang New Area will leverage its advantages of leading by example and mechanism innovation, which is suitable for reinsurance to play a positive role in the field of insurance product innovation. It will research new risk transfer products, explore the establishment of a new risk transfer product market, improve the mechanism for capital replenishment for catastrophic and special risk diversification, and stimulate industry innovation and market vitality.
"Therefore, Ping An's application to establish a reinsurance operation center in Shanghai is to seize the historic opportunity of the construction of the Shanghai International Reinsurance Center, fully rely on the leading business environment and institutional innovation advantages of Shanghai and the Lingang New Area, deeply promote the company's internationalization process, and achieve high-quality development of the company."
Among the first batch of 7 approved insurance companies, Mitsui Sumitomo Marine and Ansheng Tianping Property&Casualty Insurance are foreign-funded. During the research process, both companies expressed great confidence in the construction of the "Reinsurance International Board". In order to accelerate the catch up with the first batch of approvals, the preparatory work of the reinsurance operation center has been included in the group's internal "green channel".
"Shanghai International Reinsurance Center is expected to guide the accumulation of reinsurance resources across the country, improve the construction of reinsurance market infrastructure and institutional system, and will also take advantage of its unique resource richness, comprehensive underwriting capacity and other advantages to effectively undertake international reinsurance inward business and provide risk protection support for cross-border projects, including the the Belt and Road." Zeng Xiang, chief commercial insurance business officer of AXA Tianping Property&Casualty Insurance Co., Ltd., said.
Future development
It is reported that after Ping An Property and Casualty Insurance established its new Shanghai Reinsurance Center, the Shanghai Reinsurance Center became a reinsurance subsidiary directly under the headquarters, following the authorization of the headquarters and concentrating on the reinsurance subsidiary business.
Externally, as the resident institution of Shanghai International Reinsurance Center, according to the national "the Belt and Road" strategic layout, the company gives full play to the abundant direct insurance channel resources and international reinsurance cooperation network to provide comprehensive insurance schemes such as insurance products and reinsurance risk transfer tailored to local conditions for the risk protection needs of "going global" enterprises.
Internally, as a directly affiliated institution of the headquarters, it will be divided into centralized business management to reduce risks and operating costs through specialized centralized management.
Ansheng Tianping Shanghai Reinsurance Operation Center will leverage the leading business environment and institutional innovation advantages of the Lingang New Area, fully leverage the advantages of financial infrastructure policy integration and centralized registration, settlement, information disclosure and other functions to connect with global reinsurance technology, capital, and talent, promote the transformation and development of reinsurance business towards online and intelligent, and shape new advantages in international competition and cooperation while promoting transaction efficiency improvement and cost reduction.
