[ET Net News Agency, 20 April 2018] Moody's Investors Service said that the 2017
results of Hong Kong-listed Chinese property and casualty (P&C) insurers show that their
non-motor lines sustained overall business growth and underwriting profitability, despite
increased competition in their motor business.
"The non-motor business of P&C insurers will remain a crucial driver of premium growth,"
said Kelvin Kwok, a Moody's Associate Analyst. "And their motor business will stay
vulnerable to a further liberalization of the sector."
On the other hand, for the six listed life insurers, product structure continues to
shift to regular premium products, which is credit positive because it will lead to more
stable future cash inflows for insurers. The share of single-premium products dropped to
16% of total premiums in 2017, down from 22% in 2016 and 25% in 2015.
"The improved financial results of the Hong Kong-listed Chinese life insurers in 2017
reflect their focus on growing high-value products rather than total business scale," said
Edwin Liu, a Moody's Associate Analyst.
Moody's analysis is contained in two just-released reports titled "Hong Kong-listed
Chinese P&C Insurers: Non-motor lines sustain overall business growth and underwriting
profitability" and "Hong Kong-listed Chinese Life Insurers: Credit profiles improve as
business transformation continues".
The P&C insurers reported robust non-motor premium growth of 33% on average in 2017,
outpacing the 16% growth in their total premium.
Moody's says that the economic expansion in China - as seen by the country's strong GDP
growth forecast - will continue to spur demand for the P&C insurers' non-motor business.
In contrast, the insurers' motor business will remain vulnerable to further rate
liberalization in the sector. (KL)