China's first domestic captive insurer is preparing to go global. A reporter from China Business Journal has learned that the CNPC captive insurer is preparing to establish an overseas subsidiary. Under CIRC's current regulatory policy, captive insurers can conduct business nationwide without establishing branches, and no domestic captive insurer has yet set up branches within China.

        On January 7, 2017, the "Inaugural Conference of the Captive Insurance Committee of the Insurance Institute of China and China Captive Market Development Seminar" was held in Beijing. At the conference, Wei Guoliang, General Manager of CNPC Exclusive Property Insurance Co., Ltd. (hereinafter referred to as the "CNPC captive insurer"), revealed that CNPC Group has decided that the CNPC captive insurer will establish a subsidiary overseas. The submitted application has already reached CIRC, has been approved by CIRC's Development and Reform Department and endorsed by its International Department, and is now awaiting review by CIRC's review committee.

        Wei Guoliang stated that the CNPC captive insurer's decision to establish an overseas subsidiary will, building on the captive insurer registered domestically by CNPC, allow it to further take advantage of the preferential policies of overseas captive domiciles. At the same time, CIRC encourages the establishment overseas of wholly-owned insurance subsidiaries related to companies' business and of insurance asset management companies. He added that the establishment of an overseas subsidiary by the CNPC captive insurer to build an overseas insurance business platform will help better serve the international operations of the parent company, support the captive insurer in playing its role, and further channel the premiums of CNPC's overseas group back into China.

        It is understood that the CNPC captive insurer is the first captive insurer established in China. Founded in December 2013 with registered capital of RMB 5 billion, it is registered in Karamay, Xinjiang Uygur Autonomous Region, and operates in Beijing.

        Data from CIRC shows that in November 2016 CNPC Exclusive recorded premium income of RMB 380 million. Wei Guoliang disclosed that in 2016 the CNPC captive insurer achieved a full-year profit of RMB 346 million.

Source: China Business Journal 2017-01-08