PICC Property Suffered First Premium Drop in 4 Yrs

PICC Property and Casualty Company Limited (SEHK:2328) witnessed premium revenue of CNY 183.31 billion in January 2011, falling about 1% over the same period of a year earlier and the first drop since December 2006, announced by the property insurance firm on February 15, 2011.

The drop also dragged the Hong Kong-listed stock price to fall 4.22% to close at CNY 9.31 a share on February 15.

An analyst attributed it partly to the rapid growth in December 2010 and that part of premium revenue in December is from the insurance policies in January. The premium will return to normal level in March as the Chinese Spring Festival that goes through February also affects the premium revenue. Another analyst said that the company transferred the focus to profits from market share, giving up business that suffered losses, which is a progress. The auto insurance business takes a certain proportion in the property insurer, and currently, the sales volume of autos in second- and third-tier cities is larger, which will support the business growth.