Insurtech in China

The Chinese insurance market has grown rapidly over the past decade and now ranks as the third largest globally.

The adoption of Insurtech along the whole insurance value chain is poised to further grow and transform the industry. This is exemplified by the rising investment in insurance technology by Chinese investors. In 2016, there were 173 such investments in tech start-ups, up 44% from 2015.1 At the same time, ZhongAn Insurance, the first internet-only insurer in China, had a successful IPO in Hong Kong in September 2017. It raised USD 1.5 billion, making it the world’s largest Insurtech insurance company.2

Insurtech refers to the application of digital technology in insurance business, including making use of Big Data, artificial intelligence, the Internet of things, blockchain, telematics, unmanned aerial vehicles, and cloud computing. There has been a surge of new players, services and products in this field, which can sometimes be disruptive to the traditional insurance model. For instance, one of ZhongAn's main initial founders was Ant Financial, an affiliate of Alibaba, which operates the world's largest digital payment platform. Its strength in technology and client resources supported ZhongAn's successful product development of an e-commerce shipping return insurance.

Insurtech has gone through two stages of development in China. The first, begun in 2001, focused on online distribution (ie, selling traditional insurance products through online portals or mobile channels) by major traditional insurers like CPIC, Taikang, and PICC. This trend accelerated after 2011 when the regulator published regulations governing the insurance activities of online intermediaries.3 This resulted in the share of online premiums of intermediaries rising to 7.6% in 2016 from 0.2% in 2011.4 Competition in this segment is mainly focused on digital distribution between large traditional players such as PingAn and CPIC, and third-party platforms run by big tech companies like Alibaba and

The second stage focused on upgrading and customizing products based on technology, particularly using Big Data analytics. Examples include telematics and usage-based insurance products launched by PingAn and PICC, and critical illness products based on wearable devices offered by ZhongAn. Alongside this development, the China Insurance Regulatory Commission (CIRC) has taken an active role through approving online-only insurance licenses, and expediting filing of new products.

Insurers and big tech firms continue to explore the potential of Insurtech in China, in particular to leverage data analytics to cover risks embedded in online ecosystems. More non-insurance players can be expected to join the market. Though the regulator is believed to be drafting rules to tighten monitoring of internet lending, payments and insurance systems, it is still viewed as supportive of further growth in this sector.


1. China InsurTech Development Report 2017, Insurance Association of China, and Fudan University, 25 May 2017.

2. Premium volumes reached CNY 1.2 billion in 2016, from CNY 1.1 billion in 2015,

3. To regulate the online insurance services provided by insurance agents and brokerage companies, the China Insurance Regulatory Commission (CIRC) promulgated the Supervisory Measures for Online Insurance Services of Insurance Agents and Brokerage Companies (Trial) (hereinafter referred to as the Measures) on 27 September 2011. The measures became effective on 1 January 2012.

4. Chinese Digital Insurance Industry Report, WARP Speed Capital and InsurView, 2017.

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