This undated photo shows visitors passing the exhibition stand of ZhongAn Online Property and Casualty Insurance Co Ltd in Hangzhou. (LONG WEI / FOR CHINA DAILY)
ZhongAn Online Property & Casualty, Chinese mainland’s first and largest online-only insurance technology (insuretech) company is looking to join hands with banking and insurance industry to build up a loyal customer base with the proactive use of blockchain technology, chief executive officer Chen Jin told a Hong Kong media conference on Tuesday.
This comes after Chinese mainland’s plan to combine its banking and insurance regulators-China Banking Regulatory Commission and China Insurance Regulatory Commission.
The nature of being an insurance technology company does give us a leg-up to reduce costs and manage risks in a more efficient way
Chen Jin, ZhongAn Online Property & Casualty CEO
“Basically, the insurance industry itself calls for a stringent and well-designed regulatory framework. Today, more and more of our business falls under the dual-supervision of banking and insurance regulators,” Chen told China Daily in a group interview on Tuesday.
The Shanghai-based company, founded in 2013 and starting its business with “shipping return insurance”, where consumers pay a small fee to cover the return of products bought on e-commerce giant Alibaba’s Taobao website, booked a net loss of 996 million yuan ($157 million) for last year.
The losses were “well expected” in its prospectus filed to the Stock Exchange of Hong Kong in September last year and were largely attributed to the increase in unearned premium reserves and huge investment to bolster the company’s high-growth trajectory, ZhongAn Chief Financial Officer Francis Tang said on Tuesday.
The insuretech company generated an insurance premium income of 5.95 billion yuan for last year, a 74.7 percent increase from 2016. Revenue reached 5.58 billion yuan, a year-on-year increase of 63.6 percent.
Chen reiterated that the company remains at a “high growth” and “high investment” stage, but is moving closer to making profits for years to come. He didn’t set out a timetable.
“The nature of being an insurance technology company does give us a leg-up to reduce costs and manage risks in a more efficient way, which will be eventually reflected in our earnings performance,” Chen said.
Shares of ZhongAn remained flat at HK$68.60 on Tuesday. The Hang Seng Index edged up by 0.11 percent, or 36.17 points, to finish at 31,549.93 points. ZhongAn announced earnings after the closing bell.
The company, backed by the “three Mas” – Alibaba founder Jack Ma Yun, Tencent’s Pony Ma Huateng and Ping An Insurance chairman Ma Mingzhe – made a stellar market debut in Hong Kong with a $1.5 billion listing – the first of its kind for an internet-only insurer – in September last year.
With an oversubscription of 391.7 times from retail investors and share rally of as much as 18 percent on its trading debut, the flotation set the stage for an initial public offering spree from financial technology firms. The rush of “new economy” companies to Hong Kong marked a shake-up as the bourse has long been dominated by traditional companies such as real-estate developers, established financial institutions, oil companies and industrial firms.
China Literature, Yixin Group and Razer joined the fray to present an IPO bonanza for Asia’s financial center last year and paved the way for other promising new-economy companies including Xiaomi, Ping An-backed Good Doctor and Lufax to follow suit this year.
Copyright 1995 - 2019. All rights reserved. The content (including but not limited to text, photo, multimedia information, etc) published in this site belongs to China Daily. Without written authorization from China Daily, such content shall not be republished or used in any form.