The "wave of layoffs" in the property and casualty insurance industry is gradually receding: nearly 1,700 new branches have been added, and insurance companies are gathering to seize market depressions and compete for digital transformation

Southern Finance and Economics all-media reporters Xu Shuang and Pang Cheng reported from Guangzhou

The net exit trend of insurance companies' branches, which has lasted for nearly three years, has undergone new changes.

After combing through the public data from March 2023 to the present, the Southern Finance and Economics all-media reporter found that in the past year, a total of 1,683 branches have been added to the property insurance industry. Among them, Shenergy Property Insurance, which has been approved for construction for a short time, has expanded rapidly in about half a year, adding 1,000 branches, and has become the focus of the industry.

On the other hand, the exit progress of institutions at all levels of the property and casualty insurance industry has slowed down. According to data from the State Administration of Financial Supervision and Administration, a total of 722 branches were eliminated in the property and casualty insurance industry in 2023, compared with 1,274 in 2022.

In addition, from the perspective of the regional layout of insurance companies, Hubei, as a "deep depression" in the property insurance market, has become a "battleground" for the industry layout branches. It has become a trend for the property insurance industry to increase the laying of service outlets and accelerate the layout of the sinking market.

The winter of layoffs is receding, and the property and casualty insurance branches ushered in net growth

Judging from the overall decline in the number of branches, compared with the large-scale "wave of layoffs" in 2022, the property insurance industry will pick up in 2023.

After counting the data released by the State Administration of Financial Supervision and Administration, a reporter from Southern Finance and Economics found that a total of 722 branches of the property insurance industry will be eliminated in 2023, compared with 1,274 in 2022.

This means that the cold winter is gradually receding, and the property insurance industry is gradually entering a "warm spring". In the past year, the property and casualty insurance industry has added 1,796 branches. Excluding the 1,000 new branches established due to the establishment of Shenergy P&C Insurance, the increase in the remaining branches of the P&C insurance industry is still considerable, with a net increase of more than 100 institutions in the past year.

It is worth noting that in the past two months, Shenergy P&C Insurance has set up more than 1,020 branches at all levels in various places, and the number of institutions has been comparable to that of Taiping P&C Insurance.

Shenergy Property Insurance, which is inextricably linked with Tianan Property Insurance, a "problematic insurance company", has been attracting attention from preparation to establishment. In September 2023, the State Administration of Financial Supervision and Administration approved the establishment of Shenergy Property & Casualty Insurance Co., Ltd. ("Shenergy Property & Casualty") jointly initiated by eight state-owned institutions, including Shenergy Investment and Shanghai International Group.

In mid-January this year, after Shenergy Property Insurance completed the industrial and commercial registration procedures, its subordinate institutions at all levels successively obtained licenses issued by the State Administration of Financial Supervision and Administration and dispatched agencies. According to its official website, Shenergy P&C Insurance has a registered capital of 10 billion yuan, and the company is positioned as: "Based on the Yangtze River Delta, serving the whole country, strengthening cooperation with new energy, new technology and new business enterprises, and providing customers with a package of risk protection solutions." ”

On the other hand, since 2023, the number of branches eliminated by the property and casualty insurance industry is 866. Among them, PICC P&C has eliminated 403 branches, including 51 marketing services of Sannong Insurance, while in 2022, PICC P&C has eliminated more than 700 branches, although the number of branches has slowed down, this number is still among the top in the industry.

For insurers, performance and service capabilities are the key to the "life and death" of branches, which means that layoffs are not limited to third- and fourth-tier cities. Since 2023, Huaan P&C Insurance has eliminated 43 branches, 21 of which are located in Guangdong. Among them, 17 are located in nine mainland cities in the Greater Bay Area.

In addition, in 2024, Anbang P&C Insurance's exit will be further advanced, and all 59 branches in Hunan have been withdrawn.

Up to now, there are 44,300 institutions at all levels in the property and casualty insurance industry, accounting for 50.8% of the insurance industry.

Property and casualty insurance institutions have gathered in Jingchu to seize the depression market

Judging from the "advance and retreat" of branches in various regions, Hubei is undoubtedly the province that has focused on the layout of the property insurance industry in recent years.

In the past year, a total of 289 new insurance branches have been established in Hubei Province, of which 275 are property insurance institutions. At the same time, the property and casualty insurance industry withdrew from only 30 branches. If the number of new institutions of Shenergy P&C Insurance is removed, there are 275 new institutions in Hubei Province, accounting for 35.4% of the number of new institutions in the country.

In fact, Hubei Province, which ranks seventh in terms of GDP in the country, is a market depression in the property insurance industry. In 2023, Hubei Province's GDP will be 5.6 trillion yuan, but the insurance depth will only be 3.8%, especially the property insurance depth will be less than 1%, only 0.8%, ranking among the top three in the country.

The potential of Hubei's property insurance market can be glimpsed from the strategic actions of leading institutions to bet on them. In the past year, Ping An Property & Casualty has established 164 new branches across the country. Among them, since March 2023, 99 branches have been set up in Hubei, accounting for nearly 7 percent. At the same time, CPIC P&C has set up 48 branches in the past year, of which 24 will take root in the Hubei market in 2023.

Not only that, China Life Property Insurance, China Property Insurance, and more than 5 percent of the new branches "settled" in Hubei, and nearly 7 percent of the new branches of Sunshine Property Insurance focused on serving the Hubei business.

On the other hand, state-owned property and casualty insurance institutions are the main force to increase the insurance service capacity in remote areas. In the past year, Xinjiang has established 63 new branches of insurance institutions, of which more than 70% are branches of state-owned property insurance institutions.

In the past year, PICC P&C has set up a total of 27 new branches, including 20 new branches and marketing service departments in Xinjiang. Shenergy Property Insurance, which is positioned as a green property insurance, has set up 16 new tertiary and fourth-level institutions in Xinjiang.

In Tibet, CPIC P&C has successively set up branches in six counties, including Gacha County, Gyantse County and Dangxiong County, to provide property loss insurance, liability insurance, agricultural insurance, credit insurance, guarantee insurance, short-term health insurance and accident insurance.

Among the 34 new property insurance branches in Inner Mongolia, state-owned holding institutions account for more than 7 percent. More than 95% of the 52 new P&C insurance branches in Yunnan are held by state-owned holding institutions, of which 40 are owned by Shenergy P&C Insurance.

Digital transformation is accelerating, and online services have become the general trend

Industry insiders believe that the advance and retreat trend of insurance company branches is related to the development of the industry cycle on the one hand, and the acceleration of digital transformation of insurance institutions on the other hand.

With the deepening of the integration of the insurance industry with emerging technologies such as AI and big data, and the increasing degree of digitalization of property and casualty insurance business, the dependence of insurance business on offline physical outlets will inevitably become less and less.

For example, in terms of product sales, 13 insurance companies, including PICC Property Insurance, CPIC Property Insurance, China Life Property Insurance, and Dadi Property Insurance, have opened "digital business halls" on the Alipay platform, providing 80 kinds of consumer insurance products covering five categories, including price, quality, after-sales, logistics, and capital.

In terms of insurance claims, PICC P&C has promoted the "WeChat customer service" model in recent years, optimized the customer self-help claim experience by formulating a centralized plan for online claims, strengthened the investigation and loss assessment functions of online claims, and improved the one-stop processing capability of the online claims platform. PICC P&C said that the company handled more than 100 million cases online in 2022, with an online claim processing rate of nearly 97%.

Ping An Property & Casualty also said that by strengthening the application of technology, the company has realized data-driven customer operations online, and launched a service matrix of "one-click package, worry-free, time-saving and money-saving", aiming to create a time-saving, worry-free and full-process online claims service experience and improve customer service quality.

The "2023 China Internet Insurance Claims Service Innovation Report" released by the Institute of Finance of the Chinese Academy of Social Sciences and the Insurance and Economic Development Research Center of the Chinese Academy of Social Sciences predicts that the overall online claim settlement rate of the insurance industry will reach 85% and 95% in 2025 and 2030, respectively, and the online claim settlement scale of the insurance industry will reach 1.75 trillion yuan in 2025 and exceed 3.15 trillion yuan in 2030. This means that in the future, online insurance services have become the general trend.

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