Insurer predicts growth slowdown on mainland
The insurance industry on the mainland will grow more slowly this year after witnessing rapid growth in past years, according to Ping An Insurance, the nation's second-biggest insurer.
But the potential of the life insurance business is still huge compared with developed countries, as insurance penetration is still low, according to the company's general manager, Ren Huichuan.
Ping An had 16.4 per cent of the life insurance market in terms of premiums last year, 1.3 percentage points higher than in 2010.
The company said its investment portfolio remained stable in the first quarter of this year compared with last year, when Ping An increased the allocation of fixed-maturity assets to 81 per cent of the total portfolio, from 77.8 per cent in 2010.
Ping An also reduced the proportion of cash and cash equivalents in its portfolio to 6.5 per cent, while that of equity investments rose to 11.5 per cent last year from 9.8 per cent the year before.
Ping An said it notched up solid growth in its vehicle insurance unit and property insurance business for small and medium-sized enterprises. The insurer reported a first-quarter net profit of 7.8 billion yuan (HK$9.6 billion), up 31 per cent from 5.95 billion yuan in the same period last year.
'The company is confident that it can achieve sustainable and stable growth in its three pillar businesses, namely insurance, banking and investment,' Ping An said in a filing with the Hong Kong stock exchange last week.
Last year, the insurer had planned to sell up to 26 billion yuan of convertible bonds to generate additional working capital.
Yesterday, the company said it was still awaiting for approval from the regulatory committee.
Ping An said the money would help meet its capital needs for two to three years.
Ping An's share of the mainland life insurance market in terms of premiums last year