Insurer Ping An sets record with sale of policy

While China's economic slowdown is bad news for most, there is always the exception.

Ping An Life Insurance Co Ltd, China's second-largest life insurer measured by premium income, recently sold a policy with the total sum insured exceeding 109 million yuan ($16.7 million).

According to an insider at the company, that was a record for Ping An for the value of an individual life insurance policy.

The policy was sold by the company's life insurance branch in Shenzhen, Guangdong province, where the buyer is a private business operator who runs several companies in the city.

The majority of the insurance sum, 69 million yuan, was for accident insurance and the remaining 40 million was for disability insurance, the source said.

That suggests the wealthy individual who took out the policy is more concerned with personal safety than with the possibility of his or her business empire collapsing, said Hao Yansu, dean of the School of Insurance at Central University of Finance and Economics.

Yu Zhiwu, a 37-year-old millionaire businessman who owns a trading company in Wenzhou, in East China's Zhejiang province, said he would not spend much on insurance.

"I am not so worried about my personal safety. Only billionaires have such concerns and are willing to spend so much on insurance, especially accident insurance," Yu said.

Since the second half of 2011, most life insurers have strengthened their investments into protection-oriented products such as accident insurance and healthcare insurance.

While investment-oriented products have seen lackluster performance due to China's sluggish capital markets, people have begun to attach more importance to the protection function of insurance.

Yet, despite the eye-catching level of some insurance policies, the overall performance of China's insurance industry is flat.

According to the China Insurance Regulatory Commission, the country's premium income reached 1.07 trillion yuan in the first eight months, an increase of 6.52 percent year-on-year, of which premium income from life insurers dropped 2.91 percent to 719.1 billion yuan, while premium income from non-life insurers climbed 14.72 percent to 353.5 billion yuan.

Sino-US United MetLife Insurance Co Ltd, for instance, said recently that it will strengthen its exploration of the group insurance market for China's small and medium-sized enterprise sector.

Given the huge number of SMEs but relatively low penetration of the market, MetLife will work harder to tap that market using group insurance products, according to Bob Pei, CEO of MetLife China.