China Insurance Market and Technology Overview 2008
The need for insurance in China is expanding due to rapid economic growth and increased income. Reform of the pension and medical insurance systems has provided a broad base for the development of commercial insurance.
Insurance companies in China have increasingly recognized the importance of information technology in improving the competitiveness of enterprises and have subsequently invested a greater amount of resources in IT spending. It is expected that from 2008 to 2010, China's insurance market will experience sustained and rapid development, with a high-speed annual growth rate of around 20 percent. A new report, , examines the Chinese insurance market's overall development trends and operations, as well as analyzing insurance companies' information technology investments.
Concentration within China's life insurance market is high. China Life Insurance Company has more than 40% of the market, and the top five life insurance companies occupy 84% of the market. Life insurance companies have begun to gradually adjust their business structures to improve the proportion of limited-payment premiums available (as opposed to single premiums).
China's property insurance market concentration is also very high, with PICC occupying 40% of the market. The top five insurance companies occupy 76% of the entire property market. Foreign investment / joint venture life insurance companies have a smaller share, accounting for 8% of the life insurance market and only 1% of the property insurance market.
"Most of China's insurance companies are still in the infrastructure-oriented construction stage of development," says Celent senior analyst Wenli Yuan, author of the report. "Investments in hardware, wide area networks, and Internet access, telephone, and other communications infrastructure accounted for more than 50% of firms' total investment in information technology."
"Improving business processing systems, data warehouses, business intelligence and customer relationship management will be the focus of future IT investments," she adds.
China's domestic insurance companies should strengthen their investment in improving their business processing systems. In contrast, foreign investment / joint venture insurance companies should focus more on broadening sales channels in order to rapidly expand their market share.
The 42-page report contains four tables and 25 figures. A table of contents is available online.Members of Celent's Life/Health Insurance and Property/Casualty Insurance research services can download the report electronically by clicking on the icon to the left. Non-members should contact email@example.com for more information.