Text | "Finance and Economics" Weekly Ni Yuping
Editor|| Lu Jia
On November 19, after regulatory approval, a new director was added to the board of directors of United Property & Casualty Insurance. It is reported that with geely's shareholding in March this year, the cumulative change of board members of United Property & Casualty Insurance has exceeded one-third. The addition of new shareholders has brought more changes than this, as early as the middle of this year, United Property & Casualty Insurance achieved a capital increase of 600 million yuan.
However, at the business level, United Property & Casualty insurance has not yet found a profitable insurance type. Since its establishment, United Property & Casualty insurance has made a total loss of nearly 300 million yuan.
On November 19, the Beijing Banking and Insurance Regulatory Bureau said that it had approved the qualifications of hanxu hezhong property insurance directors. In August this year, United Property & Casualty issued an announcement that due to the change of shareholders of the company, the number of board members changed, and the cumulative number of board members changed this year has exceeded one-third of the total number of board members.
As mentioned in the announcement, the personnel adjustment of the board of directors is related to Geely Holdings' shareholding in United Property & Casualty Insurance. In March this year, the shareholders of United Property & Casualty Insurance were approved for the transfer of equity. After the change, United Life held 66.17% of the shares, Geely held 33.33% of the shares, and the original shareholder Zhongfa Industrial held the same proportion of 0.5%. Shortly after Geely's stake, United Property & Casualty increased its capital by 600 million yuan and its registered capital increased to 1 billion yuan.
However, although both shareholders and funds were in place, United Property & Casualty insurance still performed flat in terms of performance. According to the disclosure of the third quarter report of 2021, as of the end of September, its cumulative realized insurance business income was 145 million yuan, down 15.2% year-on-year, and the cumulative net loss for the year was 37.6137 million yuan, compared with a loss of 27.8218 million yuan in the same period last year.
In fact, this loss trend is in line with the past development trend of United Property & Casualty Insurance. According to the annual report, from 2015 to 2020, its net losses were: 10.961 million yuan, 35.094 million yuan, 44.867 million yuan, 67.930 million yuan, 53.249 million yuan and 50.813 million yuan. In other words, since its establishment, United Property & Casualty Insurance has made a total loss of nearly 300 million yuan.
Judging from its business structure, it is clear that United Property & Casualty is still looking for a break-even point.
According to the 2020 annual report, its auto insurance, home property insurance, corporate property insurance and engineering insurance are the top five insurance types of its premium income. Since its inception, its business structure has expanded, but the above major insurance types are in the underwriting loss.
(Source: United Property & Casualty 2020 Annual Report)
Among them, since its establishment, auto insurance has been the main business of United Property & Casualty Insurance, and it has shown a growth trend. Its premium income increased from 88.9% in 2018 to 97.7% in 2020.
However, excessive dependence on the auto insurance business is not conducive to the development of insurance companies. Under the background of comprehensive reform of automobile insurance, it has become increasingly difficult for small and medium-sized insurance companies to rely on the automobile insurance business to highlight the siege. In a recent report by Moody's, the weak profitability of the auto insurance business will continue beyond 2021, and the underwriting challenges of the non-car business will also increase. Moody's pointed out that increased earnings pressures may prompt some small property and casualty companies to exit the auto insurance business in the next 12-18 months.
However, some people in the industry believe that relying on Geely Holdings, United Property Insurance may be able to play a shareholder advantage in the field of auto insurance.
In the non-car business, hotel cancellation insurance is the second largest premium income insurance, but this insurance type is also facing a large contraction in 2020. According to the annual report, the original insurance premium income of this insurance type has dropped sharply from 13.9278 million yuan to 1.8446 million yuan, about one-tenth of last year. In addition, the family property insurance and aviation business insurance of United Property Insurance are only one million yuan in premium scale.
This article is originally produced by AI Finance and Economics, an account of Caijing Tianxia Weekly, without permission, please do not reprint it on any channel or platform. Violators will be prosecuted.