The strategic importance of China’s online insurance industry is increasingly valued by Chinese internet behemoths, so much so that a partial layout in the sector through joint ventures is not enough for their ambition for the sector.
One month after China’s online-only insurer ZhongAn, a joint venture among Alibaba, Tencent, and PingAn, went public in Hong Kong stock market, Tencent has decided it’s the time to develop online insurance independently and make it part of its core business.
Through WeMin Insurance Agency, a new insurer in which Tencent owns a 57.8% controlling stake, Tencent recently secured a new operating license from the China Insurance Regulatory Commission (CIRC) to sell insurance products on its popular messaging apps WeChat and QQ.
Tencent may move a bit slow compared with its arch-rival Alibaba, which already gained the license in September last year, but its entrance proves the quick rise of China’s online insurance sector.
Report from management consulting firm Oliver Wyman shows that 65% of new insurance policies were sold through the internet last year. The industry is expected to surge from RMB 363 billion ($54.8 billion) in 2016 to RMB 1.41 trillion by 2021.
Also, the news also shows China’s most popular apps—WeChat, Alipay and QQ—and major traffic drivers to new businesses are all going to open their support for insurance services. Users can soon find insurances embedded in their frequently used applications.