Non-life market in China faces tough conditions

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The outlook for China’s non-life insurance market is currently negative, but market conditions are expected to get better in the near term, according to AM Best’s latest briefing.

The report on China’s non-life market identifies stiff competition, along with rising investment risks and a tightening regulatory environment, as among the challenges facing the industry in China at present.

The status quo is only favourable for the large non-life firms, but not to small and medium-size insurers.

In China, there are about 85 non-life insurers operating, but the top five companies account for more than 70% of market share.

These five China non-life companies posted a combined ratio of 97.8% in 2017 from a weighted average of 98.3% in 2016.

AM Best said underwriting margins will remain under pressure in the medium term, especially for smaller insurers, but the market will improve because of the country’s strong economic growth.

This post was syndicated from InsuranceAsia News. Click here to read the full text on the original website.

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