In recent years, BATJ big technology platform companies have become increasingly enthusiastic about insurance licenses. Large financial institutions represented by Ping An Group have continued to invest in insurance technology, jointly creating a scenario where the financial war is heating up.
Text | "Finance" reporter Yu Yan
Editor | Yuan Man
"2020 is a year full of challenges... The external environment is difficult to influence, and the key lies in developing your own capabilities." Chairman and Chief Executive Officer of Tencent Holdings Co., Ltd. (0700.HK, hereinafter referred to as "Tencent") Executive Ma Huateng stated in the foreword of the annual special issue of "Three Views" recently produced by Tencent Group.
Since this year, Tencent, which has always been relatively low-key, has begun to make frequent efforts in the financial field, especially in the insurance field. Invited two generals from China Ping An to join, increased investment in Shuidichi, and promoted "Huiminbao"...
's recent big move is to acquire Samsung Assets, a subsidiary of South Korean insurance giant Samsung Group in China. Samsung Property & Casualty Insurance Company (China), Ltd. (hereinafter referred to as "Samsung Property & Casualty Insurance") has a 30% stake in it, thereby embedding a property and casualty insurance sector with a relatively controlling stake in its insurance territory.
On December 4, Samsung Property & Casualty announced on its official website that its registered capital had increased from 324 million yuan to 876 million yuan, and five new shareholders had been introduced, including Shenzhen Tencent Domain Computer Network Co., Ltd. and Shanghai Jiayin Culture Communication Co., Ltd. The company, Yuxing Technology Development (Shenzhen) Co., Ltd., Shanghai Tiancen Asset Management Partnership (limited partnership), Boyu Phase III (Shanghai) Equity Investment Partnership (limited partnership), of which Tencent holds 32%.
A week ago (November 26), a piece of news from Yonhap News Agency attracted great attention in the Chinese market: Fire Marine Insurance Company (hereinafter referred to as "Samsung Fire Insurance"), a subsidiary of South Korea's Samsung Group (Samsung), announced that day that it Signed agreements with five Chinese companies including Tencent to establish joint venture insurance companies. Samsung Property & Casualty Insurance, a wholly-owned subsidiary of Samsung Fire Insurance in China, will transform into a Sino-foreign joint venture property and casualty insurance company. At the same time, it will also become a Tencent-based insurance company.
A reporter from Caijing learned on the same day that Tencent’s acquisition has been going on for about a year. The acquisition and capital increase plan is currently subject to approval by relevant regulatory authorities.
With Tencent’s investment in Samsung Property & Casualty Insurance, its insurance landscape has assembled important insurance business sectors such as financial services, life insurance, insurance brokerage, and insurance agency. According to Caijing reporters, Tencent is also seeking a reinsurance company license.
In recent years, while BATJs have been cooperating with insurance companies as a third-party cooperation platform, they have also repeatedly obtained insurance licenses. Before Tencent, several Internet companies had also embarked on the insurance path of "joining hands" with foreign property and casualty insurance companies. Just over eight months before Tencent was reported to have taken a stake in Samsung Property & Casualty Insurance, Didi Chuxing had invested in Hyundai Property & Casualty Insurance (China) Co., Ltd., a subsidiary of another Korean giant Hyundai Group in China, through its subsidiary.
As of now, only Baidu among BATJ has not yet obtained all insurance licenses. The three major Internet giants Tencent, Ant, and JD.com have clearly formed a "triple confrontation" in the insurance field. In the current financial regulatory environment, how will ATJs interpret their own insurance layout logic?
Tencent Insurance: Accumulating full licenses
In this investment attraction plan of Samsung Property and Casualty Insurance, the shareholding ratio of Samsung Fire and Property Insurance was reduced from the original 100% to 37%, while Tencent held 32% of the shares, becoming the second largest shareholder. Haijiayin Cultural Communication Co., Ltd. and Yuxing Technology Development (Shenzhen) Co., Ltd. each hold 11.5% of the shares, while Shanghai Tiancen Asset Management Partnership (Limited Partnership) and Boyu Phase III (Shanghai) Equity Investment Partnership (Limited Partnership) each hold 11.5% of the shares. Holds 4% of shares.
Among them, the list of partners of Boyu Phase III (Shanghai) Equity Investment Partnership (Limited Partnership) includes three insurance companies, including ICBC AXA Life, Zhonghong Life, and Cigna Life Insurance.
(Samsung Property & Casualty Insurance’s shareholding structure after the capital increase, source: Samsung Property & Casualty Insurance official website)
According to the provisions of the "Insurance Company Equity Management Measures" issued in 2018, those who hold more than one-third of the shares are controlling shareholders, and The shareholding ratio of a single shareholder shall not exceed one-third of the registered capital of an insurance company. It is understood that after the new regulations were released, some large-scale equity transfer cases adopted the method of "group" transfer, with one or two as strategic or controlling shareholders, and then "matched" with one or two small and medium-sized companies or private equity fund. Allianz Property & Casualty Insurance and Hyundai Property & Casualty Insurance have previously adopted this method of attracting investment.
If Samsung Property & Casualty Insurance’s investment plan is approved, it will become the second property and casualty insurance company that Tencent has invested in after Zhongan Online Insurance Company. Although Tencent plays the role of the second largest shareholder in both companies, the share ratios are different. Tencent will have a relative controlling stake in Samsung Property & Casualty Insurance.
2005 was the year when Samsung Property & Casualty Insurance was established, and it was also the year when Tencent “awakened” to finance. In September of this year, Tencent established Tenpay, which became the predecessor of and Tencent Financial Technology .
In November 2013, Zhongan Online Property Insurance Co., Ltd. (hereinafter referred to as "Zhongan Insurance", 6060.HK), which was jointly established by Tencent, Ant Group, and Ping An Group of China, was formally established and was known as the "Three Horses" by the market. Sell insurance”. Among them, Tencent holds 15% of the shares and ranks as the second largest shareholder.
At the Zhongan online opening ceremony, Ma Huateng, who was wearing a black hoodie, Ma Yun, who was wearing a goose-yellow sweater, and Ma Mingzhe, who was in a suit and leather shoes, were brainstorming on the same stage. For the first time, Ma Huateng publicly talked about his understanding of insurance.
"It is super complicated to connect with traditional industries. The Internet only provides a bridge and tool. To truly realize the functions of finance, we need to cooperate with financial companies including Ping An." Ma Huateng said at that time.
It is understood that before 2015, finance had not yet become an independent segment in Tencent’s industrial landscape. In the insurance field, in addition to participating in Zhongan Insurance, its main contacts with the insurance industry are as a third-party platform to carry out business cooperation with insurance companies. In business cooperation, Tencent has gradually deepened its understanding of the insurance industry.
A turning point came on New Year’s Eve 2015.
At that time, people were most interested in grabbing WeChat red envelopes in various WeChat groups during the Spring Festival, and they didn’t even bother to watch a Spring Festival gala.
In the WeChat red envelope war, Taikang Life Insurance jointly launched the "Shake the Red Envelope" campaign with WeChat, gaining 50 million fans on New Year's Eve, becoming the public account with the most fans at that time. The cooperation between
and Taikang Life Insurance has become a successful application of scenario finance for the insurance industry on the Tencent platform. not only made Taikang but also Tencent realize the huge potential of WeChat as an insurance diversion portal. During the Spring Festival of the previous year, WeChat red envelopes detonated WeChat payment. It was this that triggered Taikang's inspiration for "shaking red envelopes".
Since 2016, Tencent has accelerated its layout in the insurance field. In October 2016, Jiadianbao Insurance Agency Co., Ltd. (renamed Weimin Insurance Agency Co., Ltd. , or "Weibao" in January 2017) was established. This is the first insurance platform controlled by Tencent.
At that time, Ma Huateng publicly stated when talking about WeSure: "WeSure is an important part of Tencent's efforts to build an 'Internet + Finance' ecosystem, and we look forward to it becoming a platform for close cooperation with the insurance industry."
In November 2017, WeSure The Bao mini program was launched and embedded into the "Jiugongge" of WeChat payment, starting the process of online insurance agency sales. The first product is aimed directly at the field of health insurance, and its partner is Taikang Online, a subsidiary of Taikang, which has collaborated with WeChat on the "Shake Red Envelope" program.
At that time, due to the massive number of WeChat users, the launch of WeSure was regarded by the insurance industry as a "crying wolf". However, unlike third-party platforms such as Alipay, WeBao adopts a customized "strict selection" model, taking small steps and running steadily. At that time, Weinsure CEO Liu Jiamingpu stated that Weinsure had four core keywords: simplicity, multiple scenarios, strong planning, and peace of mind. It should add to the original scenarios and become a "connector" between users and insurance scenarios.
According to the "Internet Insurance Business Supervision Measures (Draft for Comments)", an important principle of Internet insurance supervision is that "institutions are licensed and personnel are certified", and insurance must be completed on the insurance institution's self-operated platform. An insurance industry insider pointed out that since WeInsurance is an insurance agency and not just a third-party Internet platform, the new regulations will not affect its operating model. In contrast, although Alipay's Ant Insurance has an insurance agency license, Alipay itself does not have an insurance agency license, and its insurance is only a module in Alipay, not an independently operated platform, so it may need to deal with third-party platforms and intermediaries The problem of “two skins” in organizations.
While building WeSure, Tencent has not given up its pursuit of insurance licenses.
In August 2016, Hetai Life, established by Tencent through its wholly-owned subsidiary Beijing Yingke Bicheng Technology Co., Ltd., was approved and became the largest shareholder alongside CITIC Guoan . The company is positioned as an innovative Internet life insurance company.
In early 2017, Tencent teamed up with Hillhouse Capital to invest in Aviva’s Hong Kong company, holding a 20% stake. This year coincides with the Hong Kong Insurance Regulatory Authority’s introduction of insurance technology support policies to encourage the rapid establishment of insurance technology (InsurTech) companies. In September 2018, Aviva Life Insurance Company Limited (Hong Kong) launched a new brand Blue, transforming into Hong Kong’s first pure Internet life insurance company.
On January 21, 2019, Tencent acquired China Banking Insurance Brokerage Co., Ltd. through its subsidiary Shenzhen Tencent Video Culture Communication Co., Ltd. and changed its name to Beijing Tennuo Insurance Brokerage Co., Ltd., thus gaining a share in the insurance agency and insurance brokerage fields. license plate.
Starting from the first quarter of this year, the financial technology and enterprise services sectors began to be listed separately in Tencent’s reports.
In addition to building platforms and obtaining licenses, Tencent has also frequently extended olive branches to insurance industry executives in recent years. For example, WeSure has brought under its wing Shang Jiaoyan, general manager of Ping An’s personal health business unit, Wang Jiangtao, deputy general manager of Ping An Property & Casualty Beijing Branch, and Zhou Kejun, former assistant general manager of Ping An Property & Casualty.
’s biggest talent recruitment move was to invite Ren Huichuan, Vice Chairman of Ping An of China, to join the company. In June 2020, Ren Huichuan joined Tencent and served as a special adviser to Tencent's Fintech Strategic Development Department. This immediately triggered many speculations in the insurance industry about Tencent's "next step". Previously, Ren Huichuan’s predecessor and former general manager of China Ping An, Zhang Zixin, also served as Tencent’s financial consultant and participated in the WeChat project.
According to a person close to Ren Huichuan, one of Ren Huichuan’s important tasks when joining Tencent is to find and select suitable investment projects for Tencent in the field of financial technology, integrate Tencent’s financial resources, especially insurance resources, and deepen cooperation with Tencent’s financial technology ecosystem. Sector synergy.
An insurance company official said that Tencent has almost obtained all the insurance licenses it can obtain. The next step will be to integrate resources and truly realize the dual cycle of financial ecology.
However, Ren Huichuan, who became a worker in a "goose factory" from an insurance company, currently keeps a low profile. Apart from participating in some industry exchange activities in the insurance industry or financial technology industry, he rarely appears in front of the media.
Samsung Property & Casualty Insurance: The Korean giant dormant in China
There is a saying in South Korea: Koreans cannot avoid three things in their lives: death, taxes and Samsung.
In the territory of the Samsung Empire, the financial sector is the most important sector besides the electronics business, and it has been involved in this field long before entering the electronics industry.
Samsung's first financial project was the acquisition of Anguo Fire and Marine Insurance Company in 1958, which was just six years old.In October 1993, Anguk Fire and Marine Insurance Company was renamed "Samsung Fire and Marine Insurance Company" and is currently the largest property and casualty insurance company in South Korea.
Two years later, Samsung Fire & Property Insurance entered the Chinese market and set up a representative office in Beijing. In April 2001, the China branch was established in Shanghai, which is the predecessor of Samsung Property and Casualty Insurance, in which Tencent has a stake.
In April 2005, Samsung Fire and Marine Insurance (China) Co., Ltd. was approved to be established, realizing the "branch reform" (that is, the branch was transformed into a wholly-owned subsidiary) of a foreign-funded property insurance company, and changed its name to "Samsung Property Insurance" five years later. Insurance (China) Co., Ltd.”
As a "three-star" insurance company in China, the current board of directors of Samsung Property and Casualty Insurance is all Koreans. The current chairman Kim Chang-su and general manager Ji Kyung-seop are both from South Korea's Samsung Fire and Property Insurance. However, its management team is mainly Chinese, showing that it has at least achieved localization relatively well in terms of management composition.
Like other wholly foreign-owned property and casualty insurance companies, Samsung Property and Casualty Insurance also faces the development situation of few branches and small business scale. Counting from the establishment of its branch in China, there have been only six branches in 11 years, and since its establishment in 2015 No new branch was established after the Shaanxi branch. As of 2019, Samsung Property & Casualty Insurance’s premium income share in the property and casualty insurance market was only 0.1%.
McKinsey pointed out in the "New Opportunities for China's Financial Opening" report that foreign financial institutions have underestimated the uniqueness and complexity of the Chinese market, and have insufficient localization in terms of products, services, institutional mechanisms and talent systems. In addition, since foreign-funded financial institutions do not occupy a mainstream position in the Chinese market, and the rapid development of Chinese-funded financial institutions has posed a huge challenge to foreign-funded institutions, the halo effect of the brands of foreign-funded institutions among local Chinese customers has gradually faded.
However, some people in the insurance industry believe that the slow development of foreign property and casualty insurance companies in China is not only due to external factors such as network restrictions, but also to their respective corporate cultures and strategic positioning. Unlike Chinese property and casualty insurance companies, which are keen on price wars and market development strategies regardless of costs, many foreign property and casualty insurance companies are following a path that emphasizes efficiency and differentiation.
Take Samsung Property & Casualty Insurance as an example. Although its premium income has not touched 1 billion yuan for many years, it has maintained a low profit for many years. Its solvency report for the third quarter of 2020 shows that as of the end of the third quarter of 2020, the cumulative net profit this year was 66.612 million yuan, a year-on-year increase of 37.5%.
Affected by many factors such as the COVID-19 epidemic and changes in the international situation, Samsung Property & Casualty Insurance's comprehensive solvency adequacy ratio has been declining quarter by quarter since 2020, and cash flow was negative in the first quarter.
broke the dilemma and changed the ownership structure, which became a key step in the transformation of Samsung Property & Casualty Insurance. This will also be the most significant change that has occurred in Samsung Fire & Property Insurance in the 26 years since it entered China: from a foreign exclusive to a Sino-foreign joint venture.
In fact, before Samsung Property & Casualty Insurance, Allianz Property & Casualty Insurance had gone through the same transformation path, introducing shareholders such as JD.com, and changing from a sole proprietorship to a joint venture. In March 2020, Hyundai Property & Casualty Insurance (China) Co., Ltd. (hereinafter referred to as "Hyundai Property & Casualty Insurance"), a subsidiary of South Korea's Hyundai Group, was approved to introduce Legend Holdings and Didi Chuxing's wholly-owned subsidiary Dirun (Tianjin) Technology Co., Ltd. Chinese shareholders are also taking the path of turning sole proprietorship into a joint venture.
Samsung Property & Casualty Insurance’s announcement shows that on November 20, Samsung Property & Casualty Insurance’s board of directors reviewed and approved the capital increase proposal. Three days later, Samsung Fire Insurance approved the proposal.
Regarding why Internet giants have recently acquired foreign-funded property insurance companies with small business volumes, Gan Yutao, head of the strategy department of Aibo Technology, believes that from the current regulatory direction, it is a rigid requirement for institutions to hold licenses and personnel to hold certificates. Domestic insurance licenses are a scarce resource. At present, these Internet companies have accumulated a massive amount of customers and data. The insurance industry is a sunrise industry that is relatively easy to monetize. It is self-evident that there is a lot of competition here.
After the transformation, Allianz Property & Casualty Insurance and Modern Property & Casualty Insurance, with the help of new Chinese shareholders, have established a model transformation from traditional insurance companies to technology-driven property insurance companies. Among them, Allianz Property & Casualty Insurance has both premium scale and profitability. The situation has changed significantly. Will Samsung Property & Casualty Insurance also copy such a successful model?
Internet + insurance: The scenario financial war is heating up
In recent years, BATJ big technology platform companies have become increasingly enthusiastic about insurance licenses. Large financial institutions represented by Ping An Group have continued to invest in insurance technology, jointly creating a scenario where the financial war is heating up.
Huachuang Securities report believes that in the first stage, Tencent’s financial business mainly entered the market as a payment platform, expanded application scenarios, accumulated users and user data, and had the ability to financial links and reach users. In the second stage, it will complete its layout in the financial field by entering more financial scenarios and opening up connection channels with financial businesses. Then in the third stage, as a financial technology platform, it will move towards diversified scenarios of technology empowerment models. application.
An insurance technology person said that financial institutions represented by Ping An and BATJ have different paths in insurance technology. "+Internet" and "Internet+" are different logics, and the different starting points of this logic make Their understanding and application of insurance technology and scenario finance are also different.
"What kind of financial services or life services can be provided in which scenario will be the focus of competition in the industry now and in the future." A senior financial technology person said.
Up to now, Tencent’s insurance coverage has covered Tenno Insurance Brokers, Weimin Insurance Agency, ZhongAn Online, Hotai Life Insurance, Hong Kong BLUE and Shuidi Mutual Aid. If coupled with Samsung Property & Casualty Insurance and Tencent’s intention to obtain a reinsurance license, it will In just a few years, it has quickly collected almost all insurance licenses. Currently, BATJ has the most complete range of insurance licenses. After
becomes the spokesperson of insurance companies, how will BATJs leverage their advantages as technology companies in traditional insurance companies?
Regarding JD Allianz’s development path and model, JD Allianz CEO Xu Chunjun once said in an interview with the media, “JD Allianz is exploring becoming a third-generation Internet insurance company, forming an immersive model in business scenarios. An insurance service ecology and service chain creates an ecological combination of online and offline, thus completely changing the original logic and business format of insurance.”
JD Allianz, which has been “transformed” by JD.com, has become quite the style of an Internet company. , for example, about 40% of its employees are technical personnel, and its management model adopts a "large, middle office, small front office", which is exactly the opposite of traditional insurance companies.
After JD.com took a stake and changed its name, JD.com Allianz Property & Casualty Insurance quickly started an upgrade mode with JD.com’s support. Relevant data shows that in the first year of its "transformation", the premium income of JD Allianz Insurance jumped to 1.24 billion yuan, and further increased to 2.53 billion yuan in 2019, a year-on-year increase of 104%. At that time, according to JD Allianz , "It's equivalent to recreating the original Allianz Property & Casualty Insurance Company in one year."
Cathay Property & Casualty Insurance, which introduced Ant Group as its controlling shareholder, has also embarked on a path of technological transformation.
According to Cathay Property & Casualty Insurance’s external description, it focuses on expanding Internet insurance fields such as e-commerce scenario insurance, payment scenario insurance, accident insurance and health insurance, completing the transformation of traditional insurance companies and forming a new development model. In 2019, it became profitable for the first time about four years after Ant Group took over.
At present, Cathay Property & Casualty Insurance’s business is divided into three major categories: traditional institutional business, shareholder scenario business and new Internet business. According to Ant’s prospectus, among the 37.5 billion yuan in premiums and apportionments contributed by Ant in 2019, Cathay Property & Casualty Insurance’s premium income was 4.824 billion yuan.
Modern Property & Casualty Insurance has just introduced Didi Chuxing as a new shareholder. In addition to inviting Jiang Xinwei, the former general manager of the PICC Property & Casualty Insurance E-commerce Center, who has been deeply involved in the insurance e-commerce field for many years, as president, it has also started its transformation. claims that it will focus on travel. Ecology and build it into an innovative insurance company.
An insurance company person who has cooperated with Didi Chuxing said that Didi Chuxing, which has certain advantages in technology, data and scenarios in the travel field, has always been interested in entering the insurance industry. In addition to business cooperation with China Life , PICC and other insurance companies, we have also been exploring UBI (Usage-based insurance, a volume-based payment model) insurance products. Nowadays, its participation in Hyundai Property & Casualty Insurance, which also has the background of a car company shareholder, will provide it with a realistic possibility to explore and implement UBI.
Hyundai Property & Casualty Insurance stated on its official website that it will explore corresponding insurance products and services for new travel modes such as new energy electric vehicles, online car-hailing, time-sharing rentals, smart driving and driverless driving, and innovate maintenance and claim service models.
Among the two mainland insurance companies Tencent has invested in, Hotai Life Insurance has established an Internet insurance development model and is exploring the Internetization of products and sales business models, as well as Internet scenario insurance. However, its current data and development show that its Internet insurance path is far from satisfactory.
One reason may be that Hotai Life Insurance is headquartered in Jinan, Shandong, and its local Internet development environment is difficult to compare with that of Beijing, Shanghai, Guangzhou or Shenzhen.
An insurance company official said that a more important reason is that although Tencent is the joint largest shareholder in Hetai Life Insurance, its shareholding ratio is not enough to become the real talker, and its strategy may not be better implemented. "In Samsung Property & Casualty Insurance, Tencent may be able to better implement its development strategy."
Judging from the current business structure of Samsung Property & Casualty Insurance, it is currently almost blank in the field of Internet insurance and has not developed with third-party Internet platforms. Cooperation, the only new Internet product is auto insurance, and it is mainly sold through its own official website. An insurance technology person predicts that after officially taking a stake in Samsung Property & Casualty Insurance, Samsung Property & Casualty Insurance may use Tencent-based channels and platforms such as WeInsurance to open up a new world in the currently hot health insurance field.
Before these foreign-funded property and casualty insurance companies transformed into Internet-based insurance companies, several foreign-funded life insurance companies also transformed into bank-based insurance companies. With the help of shareholders, they started the transformation process. The premium scale of their bancassurance channels has reached a Riding Juechen. Can Internet insurance companies replicate this successful model today?
Gan Yutao believes that the transformation of bancassurance insurance companies by relying on the strong resources and channel advantages of bank shareholders is actually the success of the industry scale-oriented or what is called the success of bank channels. “The specific scenarios of banks do give insurance this low-frequency opportunity in terms of scale. The product makes a big difference."
However, from an operational perspective, the internal coordination problems within the groups of these banking shareholders are very prominent, which tests the top-level integration and coordination capabilities of the shareholders. "These Internet insurance companies should also follow this logic." Gan Yutao said. In his view, for the success of a new insurance company, it is important to have a good sponsor dad, but the ability to understand its own advantageous scenarios, the ability to mine and analyze its data, and the segmented understanding of customer needs are also very important. important.
