Recently, another car company has ventured into the field of auto insurance. According to the enterprise investigation data, NIO Holdings Limited established an insurance company called NIO Insurance Brokers Limited on January 19, 2022. From the perspective of equity structure, this insurance company is wholly owned by NIO Holdings Co., Ltd., with a registered capital of 50 million yuan, and its business scope includes insurance brokerage business, insurance agency business and insurance concurrently business agency business.
Source: Qichacha
It is worth mentioning that Weilai Automobile has previously issued a statement on the official App on the price increase of exclusive insurance for new energy models, and the impact on the 2021 version of Service Worry-free and Insurance Worry-free. In Xiao Lei's view, the establishment of an insurance brokerage company by Weilai this time is precisely to optimize the insurance scheme of the current new energy vehicles. You know, Weilai has always been known for its "Haidilao"-style services, and it is foreseeable that it should launch exclusive insurance products specifically for Weilai Automobile in the future.
Car companies have piled up to enter the auto insurance industry
The reason why Xiao Lei added a "and" word at the beginning of the article is because in recent years, there are not a few car companies that have personally involved in the field of auto insurance, and Weilai, which has just established an insurance company, is only one of them.
In August 2020, Tesla registered Tesla Insurance Brokerage Company in Shanghai, with a registered capital of 50 million yuan, and the establishment of this company can be said to be the starting point of Tesla in China's insurance industry. In fact, since 2016, it has launched the InsureMyTesla program in Australia, Hong Kong, and California, and launched a car insurance service exclusive to Tesla users.
In September 2018, Xiaopeng Automobile, which has always been following Tesla's example, also established Guangzhou Xiaopeng Automobile Insurance Agency Co., Ltd. and began to get involved in the field of automobile insurance. So far, among the new car-making forces alone, tesla, Xiaopeng Automobile and Weilai have been involved in the insurance field.
It is worth mentioning that although Tesla, Xiaopeng Automobile, and Weilai have all registered insurance companies, they still need to obtain the brokerage business qualifications of the insurance regulatory authorities to truly enter the threshold of the domestic insurance industry, which is also the main reason for the delay in Tesla and Xiaopeng Motors after establishing insurance companies.
In fact, for the new car-making forces, their leap from the field of science and technology to the field of automobiles is a cross-border, and their involvement in the field of automobiles to the field of insurance is another cross-border. For car companies to get involved in the insurance field, Buffett once said at the annual summary meeting of Berkshire Hathaway that it is no less difficult for car companies to carry out insurance business than insurance companies to cross-border cars.
Obviously, whether it can successfully carry out the car insurance business is also an extremely challenging thing for car companies. So the question is, before the car insurance business in the third-party insurance companies has always had a mature system, why should car companies suddenly enter the car insurance business and compete with large insurance companies?
Why do car companies pile up to lay out car insurance business
In Xiao Lei's view, there are three reasons why car companies will pile up to lay out the car insurance business: first, traditional car insurance is no longer suitable for intelligent new energy vehicles; second, the layout of the car insurance business is profitable; third, if you want to develop high-end automatic driving, the car insurance business must be controlled in the hands of the car companies themselves.
1. New energy vehicles require exclusive car insurance
The previous insurance clauses were customized for traditional fuel vehicles, and many of them did not take into account new energy vehicles in the era of smart cars. For example, there is a type of insurance called "engine special loss insurance" in the car insurance, but pure electric vehicles do not have engines and are therefore not covered by the claim.
On the other hand, the cost of batteries, motors, and electronic controls accounts for more than 60% of the total cost of pure electric vehicles. This means that once the pure electric vehicle three-electric system encounters a water failure, it will face higher maintenance costs and damage to the residual value of the second-hand car.
From the perspective of insurance frequency, China Bancassurance credit statistics show that from the first half of 2016 to 2020, the overall insurance frequency of new energy vehicles is 3.6% higher than that of traditional fuel vehicles, and the frequency of insurance of household new energy vehicles is 9.3% higher than that of traditional fuel vehicles. At present, the loss ratio of new energy auto insurance is as high as 85%, resulting in the entire auto insurance business facing the pressure of underwriting losses.
Such a situation has led not only to consumers spending a lot of unnecessary money, but even insurance companies are reluctant to underwrite new energy vehicles. Therefore, in Xiao Lei's view, Tesla, Xiaopeng Automobile, and Weilai have laid out the car insurance business because the era of new energy vehicles needs an insurance exclusive to new energy vehicles.
It was not until December 14, 2021, that the "Exclusive Clauses for Commercial Insurance for New Energy Vehicles of the China Insurance Industry Association (Trial)" was officially launched, and the exclusive insurance clauses for new energy vehicles were available. This clause includes three main insurances and 13 additional insurances of new energy vehicle loss insurance, new energy vehicle third-party liability insurance, and new energy vehicle personnel liability insurance, highlighting the structural characteristics of the "three electricity" system of new energy vehicles.
However, the launch of this clause has directly led to the increase in the premium of many new energy vehicles, which has made many new energy vehicle users complain, saying that "the fuel money saved by buying a tram has been pulled back by insurance". Among them, tesla vehicle premiums rose by an average of about 10%, high-performance models rose by less than 20%, and the average increase in Xiaopeng Automobile's full line of models also reached 2.9%-18.2%.
New energy vehicles need new energy vehicle exclusive insurance, which is the demand of the consumer side, and car companies, as profit-oriented businesses, their layout of car insurance also has a huge market space.
2. The 100-billion-level market for car insurance makes car companies salivate
Despite the crazy rise of new energy vehicles at a jaw-dropping speed, traditional fuel vehicles still dominate China's auto market. According to the research report of E-Car Research Institute, China's auto insurance premium income exceeded 800 billion yuan from 2011 to 2020.
With the rapid development of the mainland's new energy automobile industry, the sales volume of new energy vehicles in 2021 will reach 3.521 million units, an increase of 1.6 times year-on-year. In terms of ownership, the number of new energy vehicles in mainland China will reach 7.84 million in 2021, accounting for 2.6% of the total number of vehicles in mainland China. At the same time, according to the "New Energy Vehicle Industry Development Plan (2021-2035)", by 2025, the sales volume of new energy vehicles in mainland China will reach about 20% of the total sales of new cars.
It is worth mentioning that some insiders believe that the mainland may achieve the sales target of new energy vehicles in 2025 ahead of schedule, and the growth rate of new energy vehicle insurance brought about by it will also exceed expectations. According to the scrapping period of traditional fuel vehicles in stock, China Reinsurance insurance is expected to increase the annual premium of new energy vehicle insurance in the whole industry to about 200 billion yuan by 2035.
In the field of traditional auto insurance, third-party insurance companies have a huge customer base and deep industry heritage, but in the field of intelligent new energy vehicles, Xiao Lei believes that the gap between car companies involved in the auto insurance business and traditional insurance companies is not large. In addition, compared with life insurance, the profit of car insurance is not high. Therefore, car insurance is like a chicken rib for traditional insurance companies that is "tasteless and discarded".
In fact, with the advent of new energy models, car insurance is a chicken rib for insurance companies, and consumers' calls for direct insurance by car companies have become stronger and stronger. According to the survey data, in the first three quarters of 2021, the proportion of Chinese auto insurance users who are willing to buy car companies' direct auto insurance business is as high as 66.44%, which is twice as high as the number of users who do not consider buying auto insurance business directly operated by car companies.
Obviously, in the era of new energy vehicles, the entry of car companies into the auto insurance industry is not only the trend of the times, but also the expectations of the public. Automobile electrification is only one of the technical aspects of the future car, and another technical aspect of the future car also needs to be supported by direct insurance of car companies, which is automatic driving.
3. Self-operated car insurance is the threshold for automatic driving
In fact, the rapid development of the past decade is not only new energy vehicles, but also automatic driving technology. However, autonomous driving technology is different from new energy vehicles with endurance all the way, and the development process of the former is quite bumpy. In Xiao Lei's view, it is not the technology itself that hinders the development of autonomous driving technology, but the policy of long-term stagnation. Policy concerns again about the division of responsibilities in the transition from manual driving to autonomous driving.
Although autonomous driving technology has also experienced more than a decade of development, there is no clear set of responsibility division standards in the global autonomous driving field before 2020. Such a situation has led to many exaggerated car companies misleading consumers for a long time, and even caused many major accidents.
It was not until September 2020 that the International Society of Automotive Engineers (SAE) and the International Organization for Standardization (ISO) updated the grading standards for autonomous driving technology, clearly dividing the responsibilities of autonomous driving technology, and avoiding the use of the professional term "automatic driving" by car companies to promote the trick.
We can see from the SAE Driving Automation Classification that it defines the L0-L2 level system as a "driver assistance system" and the L3-L5 level system as an "automatic driving system". Such a definition also implies an insurmountable liability gap between L2 and L3. The difference between L2 and L3 level autonomous driving is mainly in the division of responsibility after the accident, and the responsibility after the accident is plainly a claim.
The current automatic driving technology is in the critical stage of responsibility division, and the accident risk of L2 and L3 level automatic driving technology is no less than that of new energy vehicles spontaneous combustion. It should be known that under the mandatory requirements of the national standard, even if the new energy vehicle has a thermal runaway, the new energy vehicle must also strive for the user to escape from the fire for 5 minutes, and the failure of automatic driving technology is likely to directly lead to serious traffic accidents.
In Xiao Lei's view, L3 level is not only the bottleneck in the development of automatic driving technology, but also the most embarrassing stage in the development of automatic driving. Car companies must ensure the reliability of the system during operation, but also allow it to have the possibility of failure to take over in predictable circumstances.
You know, even in the face of new energy vehicles with a lower spontaneous combustion rate than traditional fuel vehicles, traditional insurance companies are unwilling to bear the risk of spontaneous combustion and water soaking of new energy vehicles. Therefore, once smart cars enter the era of L3-level autonomous driving with questionable reliability, these uncertainties of L3-level autonomous vehicles will directly lead to a surge in the premium of models equipped with these technologies.
In order to develop autonomous driving technology, in order to reduce insurance rates, and in order to reduce the cost of handling after an autonomous driving accident, car companies need to take the accident risk and responsibility into their own hands. So, what changes will car companies bring to intelligent new energy vehicle insurance after laying out their car insurance business?
Car companies enter the game, and car insurance will undergo qualitative changes
Although Tesla, Xiaopeng, and Weilai have all established insurance companies, the real insurance field not only has to obtain the qualifications of relevant departments, but also faces multiple difficulties such as compliance, planning, pricing, responsibility and multi-responsibility intersection, which has led to their plans to enter the domestic auto insurance field basically in a state of stagnation.
Tesla's Overseas InsureMyTesla program is a model of insurance in the era of smart electric vehicles. Therefore, we may be able to see some clues in the future smart electric vehicle pattern in Tesla's insurance plan.
Tesla official website information shows that since January this year, it has launched a new insurance plan in some parts of the United States, and will continue to provide Tesla self-operated insurance. Because Tesla knows its own models very well, and there are fewer third-party insurance companies to make a difference in the middle, Tesla's self-operated insurance is 20%-30% cheaper than third-party insurance companies, and users can also flexibly buy insurance on a monthly basis.
In addition, Tesla's proprietary insurance is very different from the pricing rules of traditional car insurance. As we all know, the pricing rules of traditional car insurance are calculated according to the pricing of the model, the number of insurance accidents and the age of the car, and the difference between car owners cannot be identified. Tesla self-operated car insurance makes full use of the intelligent advantages of the product, designed according to the use time of the vehicle, mileage and driver's habits, and gives different pricing for different owners.
In Xiao Lei's view, including Xiaopeng Automobile and Weilai, the vast majority of new forces focusing on intelligent car manufacturing can achieve the effect of accurate insurance prices to people like Tesla. Therefore, with Tesla leading the way, it will be relatively easy for Chinese car companies to enter the field of car insurance, which is impossible for traditional insurance companies without data support.
In terms of business model, car insurance, which is just needed like maintenance and upgrade, will become the third line for car companies to connect car owners. You know, in the era of software-defined cars, car companies rely on selling cars to obtain less and less profits, and it can only "make money" from the software and service level. Nio car companies will take car insurance as the entrance to open up the whole life cycle of car owners and cultivate new business models and growth space.
Car companies enhance user stickiness and brand loyalty through direct connection with users, from simple automobile manufacturing to one-stop service providers such as manufacturing, sales, financial services, claims maintenance, etc. The rigid demand for car insurance and the high frequency of claims provide an important starting point for car companies to build a car owner service ecology.
In addition, the price increase of new energy vehicle insurance led by third-party traditional insurance companies has dissuaded many consumers who originally planned to buy new energy vehicles. If car companies can reduce the cost of purchasing insurance like Tesla after entering the field of car insurance, it can play a great role in improving the morale of new energy vehicle users.
In other words, more reasonable car insurance may lead consumers to choose a new energy vehicle of a certain car brand. Because car insurance is closely related to the user's car life. It's never a one-shot deal. More flexible car insurance not only saves money, but also provides more comprehensive security.
Note: The material for this article comes from the Internet