May. 3, 2012 (China Knowledge) - The Chinese government has allowed foreign insurance companies to enter its country’s auto insurance segment from this month; thus, giving them full access to its US$32 billion car insurance market, according to revised auto insurance rules published by the State Council
Previously, only domestic insurance companies were allowed to sell compulsory auto insurance policies.
Industry analysts said that the full opening up would likely attract more overseas property insurers to the market. However, impact on dominant domestic players is likely to be limited because of auto owners' willingness to buy both commercial and compulsory insurance policies from the same insurer and local companies' vast sales network.
In addition, the opening up is expected to help improve domestic auto insurance services.
In 2010, the 33 property insurers that run compulsory auto insurance business booked a loss of RMB 7.2 billion, according to statistics from the China Insurance Regulatory Commission