Switzerland-based Zurich Insurance Group is said to have a plan to buy into Chinese property insurance firm Sinosafe General Insurance Co., Ltd.
Sources said recently that the Swiss insurance group was looking for a stake in a Chinese property insurance firm and had cast eye on Shenzhen-based Sinosafe General Insurance. And provided that it succeeded in making the deal, it would become another foreign insurer to buy into a Chinese property insurance firm after France-based AXA SA.
An industry observer pointed out that foreign insurance firms had a plan to buy into a Chinese property insurance firm in succession driven by both fast growth and shining prospect of the Chinese property insurance sector. Statistics from the China Insurance Regulatory Commission (CIRC), the top Chinese insurance regulator, show that premium revenue of the sector enjoyed an annual growth of over 15 percent from 2006 to 2012 and the average figure exceeded 20 percent. Notably, it has been the third consecutive year for the sector to embrace an underring profit since 2009.
Zurich was established in 1872 and has entered the Chinese mainland for many years. According to data released by the CIRC, it saw premium revenue from property insurance business in the market reach CNY 144 million in the first four months of this year, ranking No.7 among foreign property insurance firms there.
People close to it disclosed in an interview days ago that in order to fuel expansion in the market, it was always busy looking for a stake in a Chinese property insurance firm and had cast eye on Sinosafe General Insurance, a Shenzhen-based property insurance firm. And prior to this, it had been in talks with Tianping Auto Insurance, but the negotiation was laid on the table for various reasons finally. Through launching mergers and acquisitions (M&As), it had fueled expansion in the Chinese life insurance sector. In detail, it as a strategic investor bought into New China Life Insurance Co., Ltd., the third-biggest life insurer in the Chinese mainland, in 2000 and later, it once even saw stake in the latter rise to 20 percent in total. And as at the end of March this year, it served as the fourth-biggest shareholder of the Chinese insurer with a 12.5 percent stake in the latter.
French insurance giant AXA said on April 24 this year that it agreed to take a 50 percent stake in Shanghai-based Tianping Auto Insurance Co., Ltd. for EUR 485 million, or about USD 630 million.
