CBIN-中国保险科技发展白皮书（英文版，2019）-2019.10-50页_131mb

China Insurtech Development White Paper (2019) Summary

Core Content

This document provides an overview of the development of Insurtech in China and globally, highlighting the role of technology in reshaping the insurance industry. It outlines the current state, trends, and challenges of Insurtech, emphasizing the integration of technologies such as Big Data, AI, Cloud Computing, Blockchain, and the Internet of Things (IoT) in driving innovation and transformation.

Main Points

1. Insurtech's Impact on the Insurance Industry

• Insurtech is deeply influencing the traditional development mode of the insurance industry, driving its digital transformation.
• The integration of technologies like AI, Big Data, and IoT is changing the industry's perception, creating new demands, and reconstructing the value chain.
• The insurance industry is transitioning from extensive development to more scientific and standardized management.

2. Global Insurtech Development Trends

• Financing Growth: The global Insurtech financing increased from 2018 to 2019, with the first half of 2019 reaching $3.077 billion.
• Geographic Clusters: North America, Asia, and Europe are key regions for Insurtech innovation.
• Sector Distribution: Life and health insurance received more financing than property and accident insurance, though the gap is narrowing.
• Financing Structure: In 2019, 77% of financing was directed towards insurance-focused Insurtech companies, while 23% went to technology-empowered enterprises.

3. China's Insurtech Development

• China's insurance market is large and has significant potential for growth.
• In 2018, China's annual original insurance premium reached 3.8 trillion yuan, ranking second globally.
• The Internet insurance market grew from 11.1 billion yuan in 2013 to 188.858 billion yuan in 2018, a 20-fold increase.
• Insurtech in China is still in its early stages, but the industry is developing rapidly.

4. Regulatory Framework

• China has introduced several regulatory measures to support Insurtech development while ensuring risk control.
• Key regulations include:
  • 2014 Exposure Draft: Marked the beginning of internet insurance supervision.
  • 2015 Interim Measures: Established standardized supervision for internet insurance.
  • 2015 Opinions on Reform: Introduced the independent agent system and opened up third-party platforms.
  • 2018 Regulatory Merger: Combined China Banking Regulatory Commission and China Insurance Regulatory Commission to enhance supervision.

Key Technologies and Applications

1. AI in Insurance

• Definition: AI is the science of developing systems that simulate and expand human intelligence.
• Core Technologies: Computer vision, machine learning, natural language processing, and human-computer interaction.
• Application Areas:
  • Intelligent Customer Service: Reduces labor costs and improves customer experience.
  • Intelligent Underwriting: Automates risk assessment and decision-making.
  • Intelligent Pricing: Enhances accuracy and enables dynamic pricing.
  • Intelligent Asset Management: Uses data and machine learning for strategic investment.

2. Blockchain in Insurance

• Patents: China leads in blockchain patent applications (4435 from 2013 to 2018, 48% of global total).
• Industrial Development: China has 456 blockchain companies, covering the entire industry chain.
• Application Prospects:
  • Customized Insurance Products: Enables precise scene recognition and risk scenario-based innovation.
  • Anti-Fraud: Uses immutable records to verify risk events and reduce fraud.
  • Smart Contracts: Automates claims processing and enhances contract transparency.
  • Mutual Insurance: Helps build a fairer, more transparent, and efficient system by reconstructing trust.

3. Internet of Things (IoT) in Insurance

• Definition: IoT connects physical objects to the internet, enabling intelligent identification and management.
• Development: China's IoT industry grew more than 3 times from 2012 to 2017, expected to exceed 1.5 trillion yuan by 2020.
• Application:
  • Precision Pricing: Enables dynamic underwriting and real-time pricing.
  • Smart City/Smart Home: Drives fundamental changes in property insurance.

Regional Development: Beijing

• Insurance Market Status:
  • By the end of 2018, Beijing had 72 legal person insurance institutions and 108 branches, ranking first nationally.
  • Insurance penetration and density in Beijing were 5.9% and 8325 yuan/person, respectively.
• Insurtech Enterprises:
  • There were 238 insurtech companies in China, with 36% located in Beijing.
• Beijing Banking & Insurance Business Park:
  • A state-level financial innovation demonstration zone.
  • Has a planned area of 65 hectares and a floor area of 950,000 m².
  • Phase-I and Phase-II projects are completed, with Phase-III set to start in 2019.
  • Attracts 30 institutions, including insurance companies, asset management agencies, and online insurance platforms.

Trends and Challenges

• Trends:
  • Insurtech is moving towards scenario-based development, focusing on product innovation and customization.
  • Technology is becoming more integrated into the insurance value chain.
  • The industry is shifting from extensive to intensive investment, targeting high-value projects.
• Challenges:
  • Security risks and standardization issues remain significant.
  • Balancing innovation with risk control is a key focus for regulators globally.

Conclusion

China's Insurtech is rapidly evolving, supported by strong government policies and a growing market. While still in its early stages, it is showing promising signs of maturity and innovation, particularly in AI, Blockchain, and IoT applications. The regulatory environment is becoming more structured, and Beijing is emerging as a key hub for Insurtech development, with dedicated infrastructure and policy support. The industry's future lies in leveraging technology to enhance efficiency, transparency, and customer engagement while managing risks effectively.