China-Singapore Jingwei, May 12 (Li Ziman) "The car produced by yourself is insured by yourself, and the insurance price should not be too outrageous", "I no longer worry about the car being denied insurance", "The wool is out of the sheep"...... Recently, BYD Property Insurance was officially approved to use the national unified compulsory traffic insurance terms, basic insurance rates and corresponding rate floating coefficients in eight regions including Anhui, Jiangxi and Shenzhen, which attracted the attention of many car owners.
On the 11th, Zhongxin Jingwei called BYD Property Insurance as a consumer, and the customer service staff said that the relevant car insurance products are still in preparation and have not yet been launched.
In recent years, including BYD, Chinese new energy vehicle companies such as NIO, Xpeng and Li have entered the insurance market. On the 10th, Zhongxin Jingwei visited BYD, Weilai, Ideal, Xiaopeng and other new energy vehicle stores as consumers, and a number of sales staff said that at present, the company has not launched self-developed insurance products, and the recommended new energy vehicle insurance is mostly the products of PICC property insurance, Ping An property insurance, CPIC property insurance and other companies.
BYD's new energy vehicle. Photo by Li Ziman
BYD Insurance has not yet been launched
At present, only BYD has a 100% controlling stake in the property insurance company (BYD Property Insurance) and has won the "birth permit" for car insurance.
On May 6, the State Administration of Financial Supervision and Administration issued an announcement saying that it agreed that BYD P&C Insurance would use the unified national compulsory traffic insurance terms, basic insurance rates and corresponding rate floating coefficients in Anhui, Jiangxi, Shandong (excluding Qingdao), Henan, Hunan, Guangdong, Shaanxi and Shenzhen.
In May 2023, BYD Automobile Industry Co., Ltd. acquired 100% of the shares of Yi'an Property Insurance Co., Ltd. and renamed the latter as BYD Property Insurance. In September 2023, BYD Property Insurance increased its registered capital by 3 billion yuan, from 1 billion yuan to 4 billion yuan.
In November 2023, the regulatory authorities agreed to change the business scope of BYD Property Insurance to include "motor vehicle insurance, including compulsory motor vehicle traffic accident liability insurance and motor vehicle commercial insurance".
It is worth noting that some netizens recently posted on social platforms that the BYD App was launched in the "Insurance Service" section, and said that BYD property insurance will be charged on a daily or even hourly basis.
On the 10th, Zhongxin Jingwei consulted the sales staff of the BYD Auto Ocean Network store in Chaoyang District, Beijing, as a consumer, and the salesperson said that BYD has not yet launched relevant insurance, and there is no statement that it is charged by the day or by the hour. At present, consumers can choose Ping An Property Insurance, PICC Property Insurance, and CPIC Property Insurance products after purchasing a car.
At present, the BYD Dynasty App and the BYD Ocean App do not display the "Insurance Service" section, and BYD's official customer service said that BYD Property Insurance has not yet been officially launched, and the specific launch time is subject to the App display.
Regarding the issue of BYD property insurance charging by day or even by the hour, on the 11th, Zhongxin Jingwei consulted BYD property insurance as a consumer, and the customer service staff said: "The information is not true, our company does not have the so-called daily insurance, on-time insurance and other similar products, our company will strictly follow the relevant regulatory requirements of the State Financial Supervision and Administration to carry out business in accordance with the law, continue to improve customer service levels, and protect the legitimate rights and interests of insurance consumers in accordance with the law." ”
Chen Donghui, former president of Swiss Re China, told Sino-Singapore Jingwei that BYD's compulsory traffic insurance pilot was approved and stood on the starting line, but it may still be far from being able to truly play its own unique advantages, and the follow-up internal resource and service integration is very critical, such as customized product research and development, product pricing, customer stickiness, etc., after a period of iteration, it may find a force point, and it remains to be seen whether the follow-up can achieve better development.
Will the premiums drop after car companies do car insurance?
"Car companies should no longer refuse to insure when they do insurance", "Finally, a closed loop of the industrial chain has been formed, and I hope that the premium price can be lowered", "As long as it is cheaper than other companies, I will definitely buy it"...... On social platforms, netizens discussed the development direction of new energy vehicle insurance after BYD property insurance was approved to pilot compulsory traffic insurance.
Problems such as "high loss ratio", "high premium" and "difficult to insure" have been accompanying the development of new energy vehicle insurance, presenting a situation of "car owners shouting expensive, insurance companies shouting losses".
According to Wang Guojun, a professor at the School of Insurance at the University of International Business and Economics, the approval of automobile OEMs to carry out new energy vehicle insurance business may lead to a series of changes, especially the high integration of automobile manufacturing and insurance business, which will make cars safer, because only safer cars can have lower insurance loss ratios, higher profit margins and market competitiveness.
Wang Guojun further said that the car factory has enough risk information for new energy vehicles, and can also take the lead in realizing the application of UBI technology in car insurance through the first installation of equipment, rear equipment and smart phones, according to the factors of the car, the driver and the environmental factors to accurately determine the rate, to achieve high rates for high-risk people and low rates for low-risk people, "thousands of people and thousands of orders", so as to solve a series of problems caused by the unfairness, unscientific and inaccuracy of the current new energy vehicle insurance, such as high prices and difficult insurance.
On the 10th, Zhongxin Jingwei visited a number of new energy vehicle company stores and found that the price of new energy vehicle insurance of about 200,000 yuan was more than 5,000 yuan, and in the same model, if you choose high-end configuration, the car insurance premium may reach more than 7,000 yuan. The annual premium of about 200,000 yuan for a fuel car is about 4,000 yuan.
Since the beginning of this year, the regulatory authorities have repeatedly stated that they will optimize the pricing mechanism of new energy vehicle insurance. In April, the State Administration of Financial Supervision (SAFS) issued the Notice on Promoting the High-Quality Development of New Energy Vehicle Insurance (Consultation Paper) (hereinafter referred to as the "Consultation Paper") to solicit opinions in the industry on expanding the independent pricing power of insurance companies on new energy vehicle insurance and enriching new energy vehicle insurance products.
Chen Donghui told Zhongxin Jingwei that if the above-mentioned "Consultation Draft" is implemented, or further open up the floating room for rates, the premium of new energy vehicles for family use is expected to decline.
Yang Shengbing, an associate professor at the School of Automotive Engineering of Wuhan University of Technology, told Sino-Singapore Jingwei that to reduce the loss ratio of new energy vehicle insurance, we need to start with cost reduction. On the one hand, it can reduce costs from the electronic control maintenance of new energy vehicles, battery cell maintenance, remanufacturing of electric and structural parts, etc.; On the other hand, insurance companies, 4S shops, and OEMs can also train claims and maintenance technicians who understand technology and claim settlement through training for relevant personnel in maintenance plants, so as to reduce personnel costs and improve efficiency. After these costs are reduced, they may lead to a reduction in the cost of car insurance claims, which in turn will lead to a decrease in premium prices, increase the insurance loss ratio, and reduce the cost of car use.
PICC property insurance and CPIC property insurance account for half of the country
In recent years, a number of new energy vehicle companies have entered the insurance industry, and from the actual development situation, car companies are still mainly sales-oriented in the new energy vehicle insurance market.
In July 2018, Xpeng Motors established Guangzhou Xpeng Automobile Insurance Agency Co., Ltd.; In January 2022, NIO Insurance Brokers Co., Ltd. was established; In 2023, NIO obtained an insurance brokerage license through the acquisition of HITOP Insurance Brokers Co., Ltd. In June 2022, Li Auto wholly acquired Yinjian Insurance Brokers Co., Ltd. and obtained an insurance brokerage license.
An insurance brokerage company is a kind of insurance intermediary, mainly providing insurance sales and consulting services, and does not have the qualification to independently launch independent research and development products. However, the regulators have a positive attitude towards the participation of insurance brokers in the development and design of insurance products. On March 1, 2013, the former China Insurance Regulatory Commission issued a document to allow and encourage insurance brokerage companies to play a greater role in product innovation, which can effectively meet the diversified insurance needs of different levels and different types of consumers, fill the gaps in insurance products in some areas, improve and enrich insurance products, and improve insurance coverage.
On the 11th, a Beijing NIO owner told Zhongxin Jingwei that he had purchased NIO's "worry-free service", which includes insurance agency, claim settlement, repair and maintenance. Among them, the insurance can choose products from PICC Property Insurance, Ping An Property Insurance, CPIC Property Insurance and other companies, and NIO will also provide additional services such as claims settlement and maintenance. This service can be ordered directly from the NIO App.
"(Xpeng) has not yet launched its own insurance products, and the insurance that can be insured for new energy vehicles is PICC property insurance, Ping An property insurance, and CPIC property insurance." Xpeng Motors salespeople said that it may be more favorable to buy it through Xpeng's insurance brokerage company, or buy it yourself or directly in the store.
According to the data released in the 2022 and 2023 annual reports and annual results conferences of CPIC and Chinese Insurance, CPIC Property Insurance and PICC Property Insurance will underwrite a total of more than 14 million new energy vehicles in 2023, accounting for half of the new energy vehicle insurance. Among them, CPIC Property & Casualty underwrote 3.1 million new energy vehicles throughout the year; The number of new energy vehicles insured by PICC property insurance may reach 7.36 million.
According to data from the Ministry of Public Security, by the end of 2023, the number of new energy vehicles in the country will reach 20.41 million, of which pure electric vehicles account for more than 75%. According to the China Association of Automobile Manufacturers, in 2023, the production and sales of new energy vehicles will be 9.587 million and 9.495 million units, respectively, with a market share of 31.6%.
According to Chen Donghui, at present, new energy vehicle companies are trying the business model of MGA (Managing General Agent) in the insurance market, but they are still in the exploration stage in terms of product personalization and pricing, and no clear plan has been formed. Car companies eventually want to form a non-inductive integration of the industrial ecosystem through insurance, which seems to take a long time.
According to public information, in the MGA model, in addition to marketing, the content of the insurance company's authorized intermediaries also involves underwriting, underwriting, payment, claims, risk control, product customization, and even actuarial and reinsurance business.
"It is necessary to open up the application of insurance technology by insurance companies and insurance brokerage companies, give a certain margin for error, and suggest that BYD Auto Insurance carry out various pilots, so that new car-making forces such as Weilai, Xiaopeng, and Ideal can develop their hands and feet in insurance technology." Wang Guojun said.
(For more reporting clues, please contact the author of this article, Li Ziman: [email protected]) (Sino-Singapore Jingwei APP)
(The views in the article are for reference only and do not constitute investment advice, investment is risky, and you need to be cautious when entering the market.) )
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Editor in charge: Luo Kun and Li Zhongyuan
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