Several car companies enter the insurance market

Several automobile groups are trying to enter the insurance market by initiating and holding professional auto insurance companies.

It is understood that Guangcheng Group's Zhongcheng Automobile Insurance Co., Ltd. (Zhongcheng Motor Insurance) is currently starting a strategy to increase capital and expand stocks. The registered capital will increase from 500 million to 1.5 billion yuan, and the next step will be to expand the market. Zhong Cheng Motor Insurance was approved by the China Insurance Regulatory Commission in June 2011 and became China's first national auto insurance company initiated and controlled by the Automobile Group.

On June 15, 2012, the China Insurance Regulatory Commission approved the opening of Xinan Automobile Insurance Co., Ltd. (Xinan Motor Insurance). The Morning Post reporter learned from the relevant channels that CNHTC also intends to build its own auto insurance company.

The overall automotive market is in a sluggish state. This type of professional auto insurance company is in a contrarian expansion. What impact will it bring to the market? Market participants believe that professional auto insurance companies will have more competitive advantages in formulating insurance policies and marketing systems backed by the background of shareholders of auto makers. However, auto insurance is ultimately a competition of capital, talent, technology, brand, and other comprehensive factors. It is difficult to say whether the holding auto insurance companies can seize market share.

Some industry insiders are concerned that the emergence of this type of company may cause the auto group to directly monopolize the spare parts resources, so that the profits of maintenance prices will be transferred to lower auto insurance premiums, which may lead to vicious competition in the market.

Easy to control auto insurance costs

Relying on the advantages of the major shareholder Guangzhou Automobile Group, the premium of Zhongcheng Auto Insurance in 2012 will reach 240 million yuan, of which the proportion of auto insurance premiums will reach 80%. About 40 million yuan in insurance premiums came from the business of shareholders. About 75% of auto insurance customers are GAC brand customers. 60% of premium income comes from 4S stores.

The Morning Post reporter was informed that the company’s shareholder Guangqi Group has approached some large auto dealers and started to increase the share of Zhongcheng Auto Insurance’s capital increase. For Zhongcheng Insurance, which currently has a solvency adequacy ratio far exceeding the regulatory requirements, the next step will be to accelerate the layout of the organization's network, which is preferred in southern China, and secondly consider expanding business in East China and Southwest China. The company currently has a total premium of less than 300 million yuan, a capital of 500 million yuan, and sufficient solvency.

Zhong Cheng Motor Insurance seeks professional management ambitions. According to Shi Fuliang, general manager of Zhongcheng Auto Insurance, he hopes that the premium of auto insurance will reach 98%. After that, it does not rule out the development of other non-auto insurance business for its customers through the auto insurance platform.

According to market sources, there are already some auto groups planning to set up their own auto insurance sales company. By controlling the auto insurance company, internal control over customer information and maintenance resources will improve its overall profitability. Since the background of the shareholders is automotive companies, auto insurance companies are familiar with the performance and safety of the models they produce. They can fine-tune their risk status when formulating insurance policies, and can manage expenses on insurable claims.

While specializing in auto insurance business, auto insurance agency specialization will gradually become a trend. On September 24 this year, the China Insurance Regulatory Commission formally issued the “Notice on Supporting the Specialized Operation of the Agency Insurance Business of Automobile Enterprises” to encourage and support the auto companies to invest in the establishment of insurance agents and insurance brokerage companies, and promote the professionalism of insurance companies in automobile enterprises. Management.

Channel control will bring vicious competition?

For the automobile company's auto insurance company's development model, market participants have different views.

A person in charge of a property and casualty insurance company stated that although it is possible to rely on the 4S stores owned by GAC Group to expand sales, it is not always possible for Zhongcheng Motor Insurance to smoothly enter the 4S shop channels owned by other auto groups. In the future, most of the businesses will still be based on their own brand service channels, and the scale of the company's development will remain unspeakable. However, the person in charge said that Guangzhou Automobile brand market share is not high.

The above-mentioned person in charge continues to express that, in markets such as the United States and Europe, automobile OEMs cannot have their own repair shop or repair shop to allow insurance companies to prevent monopoly. Automakers start their own auto insurance companies, and more are trying to increase their own product bargaining power by controlling customer resources, insurance products, and spare parts maintenance.

The above-mentioned sources said that auto OEMs have their own insurance companies, or bring vicious competition to the market. Since customers of auto insurance companies can only perform repairs at repair plants controlled by them, in the case of insufficient supply of spare parts, it is easy to form a monopoly and profits can be realized by increasing the price of spare parts for repairs. This can make up for the reduction of auto insurance premiums, but will bring vicious price competition to the market.

The above-mentioned person in charge of the P&C insurance company stated that for this type of auto insurance company, the CIRC’s attitude may also be very “fuzzy” and it is hoped that the market will be nurtured through diversified development models.

According to Professor Guo Guozhu of the Department of Insurance of the Capital University of Economics and Business, it is unlikely that a single car manufacturer controls the monopoly of the entire industry under the background of market competition. On the contrary, diversified choices will enable the auto insurance companies controlled by the same auto group to form cooperation with the maintenance factories to reduce costs, thereby reducing the maintenance prices of consumers.

According to market participants, the market trend of automobile insurance rates has become a trend. According to the sensitivity of consumers, market competition is more likely to cause the overall decline in premium prices, which is a challenge for some small and medium-sized companies. Although relying on the background of the shareholders of auto companies, professional auto insurance companies can seize part of the market share, but the auto insurance market depends on a combination of capital, technology, talent, product competitiveness, service team, and organizational structure. Therefore, professional management Whether the model can be stronger or bigger will have less impact on the impact of the traditional auto insurance model.