Swiss Re, one of the world's largest reinsurers, launched operations Friday in Beijing, making it the second foreign reinsurer to get a green light to do business in China.
It follows Munich Re into the sector -- a major rival in global reinsurance market.
Swiss Re will conduct nationwide business with its headquarters in Beijing, and will develop business in both non-life and life reinsurance arenas, the company said.
The firm will have branch operations in Shanghai, and sub-branches in other cities.
"China is definitely taking over the limelight as the insurance world's biggest new growth opportunity," said John Coomber, the firm's CEO. "We view this move as an essential step to our success here," said Coomber, whose company received its operating license approval from the China Insurance Regulatory Commission in September.
The executive declined to make any profit projections, however. "China and Japan will become two major sources of business for Swiss Re in the future," he said.
"We bring our global financial strength and international expertise in risk management and add strong local understanding."
Coomber has no current plans for acquisitions in China, but left open that possibility.
China's WTO commitments require the country to fully open its insurance markets to foreign competition by 2006, when most of the domestic insurance companies are set to finish their internal reforms and become more efficient and competitive in the world market.
Two milestone events in the Chinese insurance sectors recently include the listing of the People's Insurance Company of China and China Life, the Chinese mainland's two largest state-owned insurers in Hong Kong and New York. Both received great fanfare and were over-booked in the market.
And the country's sole reinsurer, China Re, is still on track of restructuring by turning itself into three separate companies -- one life reinsurance company, one non-life insurance branch and a direct insurance company aimed at reacting to foreign competition.
As of today, China is home to about 60 insurers, and the number of insurance brokerage firms has increased to 587, including insurance agents, insurance intermediaries and rating companies.
China's premium totals stand at 305.3 billion yuan (US$36.87 billion), up 44.7 percent from the previous year.
(China Daily December 20, 2003)
