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Insurance JV secures Chengdu licence
By Li Wenfang (China Daily)
Updated: 2004-06-01 15:01
AVIVA-COFCO Life Insurance has obtained the approval for setting up a branch in Chengdu, capital of Southwest China's Sichuan Province, becoming the first foreign-linked life insurer to get the go-ahead for serving the city.
A joint venture between United Kingdom-based insurance giant AVIVA and China National Cereals, Oils & Foodstuffs Import & Export Corp, Guangzhou-based AVIVA-COFCO got the green light in February for opening a branch in Beijing.
The branches in Chengdu and Beijing are expected to start operations within this year, a spokeswoman of the company said yesterday.
The two new branches further pave the way for fulfilling AVIVA-COFCO's goal of grabbing 10 per cent of new life insurance business in at least 10 targeted cities in China by 2010, the company said in a statement.
AVIVA-COFCO has yet to apply for the licences for its operations in cities aside from Guangzhou, Beijing and Chengdu, the spokeswoman said.
Preparing for the launch of the Beijing branch, AVIVA-COFCO has planned a diversified sales channel, regarding the city as an important market, the company said.
About 40 per cent of the premium of the branch is expected to come from the insurance agents and brokers, another 40 per cent from partner banks and the remaining 20 per cent from group insurance, said Eric Chang, general manager of AVIVA-COFCO in the statement.
Group insurance business, however, is subject to progress in the expected opening-up of this sector to foreign insurers this year, Chang said.
Guangzhou was among the first Chinese cities that were opened up to foreign insurers in the first year after China joined the World Trade Organization (WTO) at the end of 2001.
Beijing and Chengdu were opened last year.
China has promised to lift geographical restrictions for foreign insurance companies three years after it joined WTO, which means all domestic cities will be opened up by December this year.
Set up in January last year, AVIVA-COFCO has a registered capital of 500 million yuan (US$60.24 million).
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