According to statistics from the Chinese National Financial Regulatory Administration, in the first 10 months of the year 2023, the direct insurance premium income of the property insurance industry increased by 7.16% from 2022. This rate is lower than the 9.94% growth in 2022/21. Despite being lower, it is still considered a high growth rate, in line with the average growth rate for the period 2012-2021.

However, compared with other industries, the insurance sector seems to show a stable growth trend. Over the past ten years, most industries experienced high fluctuations in development activity.

On the other side, the amount of claim indemnification has increased due to the improvement in travel after the pandemic and the impact of multiple natural disasters. It should be noted that the property insurance industry has played an increasing role in risk protection across various fields in China. For instance, during the summer, Beijing, Tianjin, and Hebei suffered heavy rainstorms. The total insured loss reported by these three locations exceeded 700 million RMB. Many insurance companies invested in frontline rescue work, willingly carried out risk investigation, provided fast-track claim settlements, and used modern technology to prevent disasters, issue warnings, and provide extra services. This demonstrates their ability to compensate for losses and improve risk prevention.

On December 18th, a magnitude 6 earthquake hit Jishishan in Gansu province and Artush city in Xinjiang, once again bringing operational challenges to the insurance industry.

According to statistics, property and casualty insurance claims increased by 17.8% in the first 10 months from 2022. This increase is almost four times higher than the rate of increase for the period 22/21, which was 4.1%. Several factors behind this increase include the impact of natural disasters and the increase in vehicle usage after the pandemic, leading to a rise in claim frequency.


The strong development resilience of the industry today is inseparable from continuous and deep changes experienced by the insurance industry. Initially, the change was driven by the contribution of motor insurance to the total premium income collected in the insurance market. In 2012, the premium volume from motor insurance accounted for about 70% of the total premium income for the entire property market. However, the motor insurance market faced challenges such as overstaffing, generating prohibitive costs, unhealthy competition, and price wars occurring between employees from the same company to gain business.

The revolution in the motor insurance market started in 2012. Over the past ten years, the proportion of car insurance premium income to the whole property insurance market dropped to about 50%. By the end of October 2023, the premium volume emanating from motor insurance accounted for 52% of the total premium collected.

A notable change includes a comprehensive reform of car insurance on September 19th, 2020, called the “Guiding Opinions on Implementing Comprehensive Reform of Automobile Insurance.” This reform increased the limit for compulsory third-party liability from 122,000 RMB to 200,000 RMB, and theft and rescue coverages were included in the primary insurance coverage of property damage motor insurance. The short-term goal was to provide more flexibility in premium rates to decrease the number of “uninsured cars,” increase the number of insurers, and improve the quality of services provided by insurers. This goal seems to have been achieved.

Meanwhile, ongoing reforms have continued. In 2023, a second reform of motor insurance aimed to increase competition among motor insurance players and improve underwriting results. The range of independent pricing for commercial auto insurance expanded, giving more power to insurance companies to incentivize safer driving behavior among drivers, thus enabling car owners to enjoy better premium rates. This led to a decrease in premiums collected by insurers. The main difference from the previous period (2012-2019) is that competition regarding premiums is now based on better strategies from insurers to achieve better underwriting results and control costs in all aspects.


Car insurance has forced property insurers to standardize their operations and diversify their sources of business to other insurance lines. Aligned with the policy implemented by the Chinese government to support the rural sector and improve the efficiency of the operational structure of insurers, traditional non-auto insurance products, represented by agricultural insurance and liability insurance, offer an opportunity for insurers to expand the range of products available on the market.

Among them, agricultural insurance has gained more and more support from the government. The government has issued significant support for “grain cost insurance” and “planting income insurance” to cover all major grain-producing provinces. Thanks to this government initiative, the premium income of agricultural insurance increased by 18.7% in the first 10 months of 2023, higher than the overall growth rate of 7.16% for the whole property insurance industry in the same period.

Furthermore, the premium income of liability insurance in the first 10 months increased by more than 10%. Concerning liability insurance, D&O insurance has been popular for several years, leading to an increase in the number of insurers writing this line. The State Council decided to further strengthen the position of independent directors in listed companies, encouraging public listed companies to purchase directors’ liability insurance for independent directors, prompting insurance companies to develop relevant directors’ and officers’ liability insurance.


At this moment, the new energy vehicle insurance market remains a challenging business. Many insurance companies have failed to make a profit on the underwriting side. The “three highs” of high premiums, high insurance rates, and high loss ratios of new energy vehicle insurance are still common issues for insurance companies and policyholders. Due to the nature of new technology vehicles, insurers lack accurate data to determine the right premium level, resulting in premiums that can be either too low, negatively impacting the insurer’s underwriting results, or too high, which is obviously not favorable for the insured.

BYD ranks at the top among the top 10 Chinese new energy vehicle players. They acquired 100% of the shares of Yi’an Property Insurance this year, entering the new energy vehicle insurance business. Currently, they have been only licensed as a motor vehicle insurer. The entry of new energy vehicle manufacturers into the auto insurance market helps control the repair cost of vehicles and reduce the business acquisition costs of clients. The use of vehicle driving data may drive innovation in the motor insurance business.

Prepared by Marc Burban / Founder and General Manager at Asian Risks Management Services LTD