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Christine Chan

Premium income at the People's Insurance Co of China's (PICC) property insurance operations rose 7 per cent to 22.5 billion yuan (about HK$20.94 billion) in the first half of this year.

 PICC is the mainland's largest insurer, with its People's Insurance (Property) Co of China (PICC Property) arm the country's top property insurer.

 Property and life insurance together account for a dominant share of PICC's revenue - which also embraces re-insurance - although property insurance is increasingly giving way to life insurance as PICC's leading money spinner.

 PICC Property said it paid nine billion yuan in compensation in the first six months, a 14 per cent increase on last year's payout, the China Daily reported yesterday.

 Despite the seriousness of the flooding along areas of the Yangtze River, PICC Property officials said the torrent was unlikely to wipe out its annual target of 40 billion yuan in premium income.

 They said losses of insured properties amounted to 2.65 billion yuan by the end of last month. The flooding started in the middle of June.

 PICC Property - alongside PICC's life insurance and PICC re-insurance operations - is expected to be hived off from PICC as a separate entity as Beijing moves to draw a dividing line between life and non-life insurance businesses to align with international practices.

 PICC vice-chairman Wang Xianzhang said in Hong Kong last week PICC would be disbanded in October, with its property, life and re-insurance arms spinning off as three separate entities in order to concentrate on different markets.

 Its regulatory function would be taken over by a newly formed committee under the State Council, the China Insurance Supervision Committee, he said.

 It is understood that PICC is awaiting the official documents from the State Council on the disbandment.

 Last year, PICC saw premium income rise 35.7 per cent to 78.8 billion yuan, led by its life insurance division with 38.9 billion yuan on growing awareness for the product in the mainland.

 PICC, China Pacific Insurance and Ping An Insurance of China are the mainland's three leading insurers, accounting for a combined market share of more than 90 per cent.



Rains raise few fears as PICC first-half property revenue passes $20b