Tencent will soon sell insurance to Hong Kong residents with new online tie-up
Hong Kong’s Insurance Authority blesses joint venture, which is expected to commence operations later this year
UK insurance giant Aviva and its partners Chinese internet major Tencent Holdings and private equity fund Hillhouse Capital have received regulatory approval to launch a digital insurer, Aviva said on Tuesday.
Last January, the 322-year-old UK insurer signed an agreement with Tencent and Hillhouse to sell shares in Aviva Life Insurance Company (Aviva Hong Kong) to turn it into a digital insurer.
Aviva has been operating in the city since February 2002, according to the company.
Tencent will own a 20 per cent stake in the joint venture, while Hillhouse and Aviva will each hold a 40 per cent stake.
“The joint venture has been approved by Hong Kong’s Insurance Authority and is expected to start operating under its new corporate structure during the first half of 2018,” Aviva said.
The move also marks Tencent’s foray into Hong Kong’s digital insurance market, after it expanded its footprint in mainland China’s insurance market.
Insurtech is a fast-growing sector globally, particularly in the US and Europe, and now Asia-Pacific is also catching up. Data from venture capital database CB Insights reveals that insurtech investment globally totalled US$1.7 billion last year, doubling from 2014.
In 2016, Tencent launched online life insurer Hetai Life Insurance with a group of investors that included Munsun Capital, CITIC Guoan, and Beijing Easyhome Investment Holding.
In January 2017, Hetai Life commenced operations after receiving the green light from China Insurance Regulatory Commission.
In 2013, Tencent founded ZhongAn Online Casualty and Property Insurance, the country’s first internet-only insurer along with Alibaba Group Holding affiliate Ant Financial and Ping An Insurance.
ZhongAn went public in Hong Kong last September, raising US$1.5 billion. Its market value currently stands at HK$97 billion.
Other Chinese companies have also shown interest in Hong Kong’s insurance business.
In 2016, Fujian-based Tahoe Investment agreed to buy the life insurance business of Hong Kong’s Dah Sing Financial Group for HK$10.6 billion.
