China United Property Insurance Suffe Shrinking Market Share

As the fourth largest property insurance company of China's Mainland, China United Property Insurance Company has seen the negative growth in premium revenues for consecutive six months this year.

According to available data, China United Property Insurance achieved the premium revenues of CNY 10 billion during the first six months of this year, down 14.84% compared to the corresponding period of 2009. By the middle of this year, the market share of the company shrank from 7.7% as at the end of 2009 to 4.8%.

By month, the property insurer during this January earned premium revenues of CNY 1.66 billion, down 15.15% year on year; and the premium revenues went down 19.79% to CNY 890 million in February; those in March reached CNY 1.65 billion, down 20.55% year over year; the single-month premium revenues were CNY 1.8 billion this April, a decrease of 23.97% year on year; in May, such premiums amounted to CNY 1.9 billion, still down 18.75% compared to the same period of 2009; and June's premiums hit CNY 2.1 billion, a year-on-year decrease of 14.84%. In the whole year, the company might perform worse compared to 2009.

As early as 2007, China United Property Insurance had been reported to have suffered losses of CNY 6.4 billion. Last year, therefore, China Insurance Regulatory Commission partnered with relevant local departments to adjust the company's internal management and make new development policies for the company. The insurer even wanted to increase its registered capital up to CNY 9 billion but failed due to various reasons.

During the first six months of this year, PICC Property and Casualty Company Limited (PICC P&C, 2328.HK) as the property insurance unit of the People's Insurance Company (Group) of China Limited made the premium revenues of CNY 81.4 billion, followed by CNY 29.97 billion of Ping An Property and Casualty Insurance Co. (Ping An P&C) and CNY 27.04 billion of China Pacific Property and Casualty Company Limited. Noticeably, Ping An P&C has gradually caught up with PICC P&C in terms of the premium revenues and has set the goal to beat PICC P&C by 2014.

As for those second-tier property insurers, China Continent Property & Casualty Insurance Company Ltd. in the first half year reaped premium revenues of CNY 6.84 billion, followed by CNY 5.59 billion of Sunshine Property and Casualty Insurance Co., Ltd. and CNY 5.58 billion of China Life Property and Casualty Insurance Co., with the year-over-year growth of 20.15%, 83.13% and 36.1% respectively.