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Insurance Cooperation Started in Mainland-Taiwan Years Ago

Posted on: Wed, 18 Nov 2009 06:27:00 EST

Symbols: LFC

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BEIJING, Nov 18, 2009 (SinoCast Daily Business Beat via COMTEX) --
LFC | Quote | Chart | News | PowerRating -- A group of top insurance executives from Taiwan were in fact introduced into Mainland China for pioneering the mainland insurance market at an early stage, insurance insiders told the Oriental Morning Post, a Shanghai-based newspaper. Many of the mainland's insurance marketing skills were from Taiwan then.

For instance, Ping An Insurance (Group) Company of China Ltd. (PAIC, SEHK: 2318, SHSEK: 601318), the insurance titan in the mainland, once conducted a high-end insurance recruitment plan for Taiwan talents, becoming a blockbuster move in Taiwan's insurance industry at that time. Taiwan's insurance executives organized much of the marketing trainings of China Life Insurance Co., Ltd. (NYSE: LFC, SEHK: 2628, SHSE: 601628), the biggest life insurance company in the mainland.

Taiwan insurance companies entered the mainland market several years ago. Firstly, Cathay Life Insurance Co., Ltd. (TSEC: 2805) under the aegis of Cathay Financial Holdings Co., Ltd. teamed up with China Eastern Airlines Corporation Ltd. (NYSE: CEA, SEHK: 0670, SHSE: 600115), one of the mainland's biggest airlines, to set up a joint-venture life insurance company in Shanghai in 2005, opening the door for cooperation between both sides' cross-strait insurance industries. In September 2008, Cathay Insurance Co., Ltd. was officially inaugurated in Shanghai, as the first property insurance company across the Taiwan Strait.

In October 2009, Shin Kong & HNA Life Insurance Co., Ltd., headquartered in Beijing, formally started commercialization, its two founding companies announced. It is a joint venture between Taiwan-based Shin Kong Life Insurance Co., Ltd. and HNA Group, a midsize airline in the mainland. In addition, other Taiwan financial giants like Fubon Financial Holding Co., Ltd. (TSEC: 2881) are also following suit.

However, mainland-based insurance operations have not yet invested in the Taiwan market or branched out there.

Liu Te-shun, vice chairman of Taiwan's Mainland Affairs Council (MAC), citing Taiwan media, said on October 26, 2009 that the policies and regulations on opening the door to mainland investors were put into force as of June 30. The MAC expected to bring forward an assessment report within six months, with the aim of improving the above rules.

The Memorandum of Understanding on Cross-strait Insurance Regulation reached on November 16 is just a possibility of further cooperation between the mainland and Taiwan in the future, insurance experts believed. If the mainland insurance industry entered the Taiwan market, it would face a string of challenges from local policies and the local long-experienced and relatively-saturated marketplace and there would be a long way for mainland insurers. For the moment, mainland insurers could witness faster chances, namely, to invest in Taiwan as qualified domestic institutional investors (QDIIs), according to the mainland's investment rules.

Source: www.hexun.com (November 18, 2009)

For full details on China Life Insurance Company Limited ADS (LFC) LFC. China Life Insurance Company Limited ADS (LFC) has Short Term PowerRatings at TradingMarkets. Details on China Life Insurance Company Limited ADS (LFC) Short Term PowerRatings is available at This Link.

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