Williamstown, MA -- (SBWIRE) -- 05/01/2012 -- China's insurance industry has evolved rapidly since 2005, nowhere more so than in the motor insurance category. Large profits and considerable growth have followed the introduction of compulsory motor third-party liability insurance (MTPL), and an exponential rise in new car sales. This favorable situation has attracted many domestic and international companies to enter the Chinese motor insurance market.
During 2011, the Chinese motor insurance industry represented 71.8% of the country's non-life insurance market. Market growth, coupled with the motor insurance category's dominance of the non-life segment are attributable to the introduction of compulsory MTPL as of July 1, 2006, and the significant increase in car ownership that recently saw China overtake the US as the largest new vehicle market in the world. During the review period (2007-2011), rising levels of personal wealth led to an average annual increase of 25% in the number of privately owned vehicles and a situation whereby the Chinese motor insurance industry grew at a CAGR of 25.65% during the review period.
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- The growth of the Chinese motor insurance category is directly related to the growth of the economy and the automobile industry. Automobile sales (passenger cars, motor bikes and commercial vehicles) grew at a CAGR of 14.65% during 2008-2011.
- Motor insurance penetration, as defined by gross written premiums as a percentage of GDP, increased from 0.42% in 2007 to 0.72% in 2011, growing at a CAGR of 14.16% during the review period.
- In May, 2011, the China Insurance Regulatory Commission (CIRC) pledged to advance toward allowing foreign insurance companies to sell mandatory third-party liability (MTPL) motor insurance in the Chinese market.
- The internet is emerging as one of the most powerful and attractive promotional tools for insurance companies. Using social networking sites to interact with end consumers and increase brand awareness is becoming common practice.
- The Chinese motor insurance category remains highly consolidated with the top three companies accounting for more than 50% of the overall industry. Leading motor insurance companies include: PICC Property and Casualty Insurance Co., Ltd, Ping An Property & Casualty Insurance Company of China Ltd, and China Pacific Property Insurance Co., Ltd.
- Companies in the Chinese motor insurance category are finding it difficult to fulfill the new Solvency II requirements and both profitability and performance are suffering as a result.
This report provides a comprehensive analysis of the motor insurance industry in China:
- It provides historical values for the Chinese motor insurance industry for the report's 2007-2011 review period and forecast figures for the 2012-2016 forecast period
Companies Mentioned in this Report: PICC Property & Casualty Company Limited, Ping An Property & Casualty Insurance Company of China, Limited., China Pacific Insurance (Group) Company Limited (CPIC), China Continent Property & Casualty Insurance Company Limited (CICC), Sunshine Property And Casualty Insurance Company Limited
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