Ping An Insurance (Group) Co, China's second largest life insurer, reported year-on-year 18.3 percent premium income growth in 2010, while China Pacific Insurance (Group) Co announced Tuesday an even more impressive 48 percent premium hike.
Ping An's life insurance premium for last year totaled 159.06 billion yuan ($24.16 billion), or 92.65 billion ($14.07 billion) based on new accounting rules. China Pacific had accumulated life insurance premiums of 92 billion yuan ($13.98 billion) for 2010.
According to published data of China Insurance Regulatory Commission (CIRC), Ping An's life insurance premium growth slowed compared with 2009 and 2008 when it achieved year-on-year 30 percent and 27 percent growth respectively.
But China Pacific premium growth seems to be rebounding, surpassing the pre-crisis level of 30 percent in 2008, after a mere 2 percent growth due to business fine-tuning in 2009.
"The major driving force behind Ping An's premium sales is improved productivity of its insurance agents, while China Pacific's premium was mainly contributed by its strong bank sales," Luo Qi, an insurance analyst with Ping An Securities, told the Global Times Tuesday.
China's largest insurer China Life Insurance (Group) Co had not released the premium data for the whole year 2010. But it already recorded 13.7 percent premium growth for the first 11 months last year compared with the same period of 2009.
Global reinsurers Swiss Re predicts that life insurance in Asia can sustain annual growth of about 10 percent over the next 10 years in terms of premium, with China as the major driver, accord-ing to Swiss Re's report released last Thursday.
The overall life insurance premium in China was expected to increase remarkably by 24.4 percent in 2010 after adjustment for inflation, the report stated.
Increasing awareness of insurance, rising disposable household incomes, low deposit interest rates, and improving investment sentiment will further drive demand for insurance products, said the report.
For 2011, with the burgeoning development of the insurance market, competition will also get intensified. Luo of Ping An Securities projected an overall trend of slowing growth and profits due to competition and tightening rules issued at the end of last year.
The China Banking Regulatory Commission issued a rule in November banning agent's sales in bank outlets and limiting the number of insurance products sold by single bank outlets. Since that time, China Insurance Regulatory Commission also enacted a ban on cold sales calls.
