The premium of Xiaomi SU7 "surpasses" Maserati, with an annual car insurance premium of seven or eight thousand yuan

Shangguan News

2024-05-12 14:19Posted on the official account of Shanghai Shangguan News

The Xiaomi SU7 (pure electric) priced at more than 200,000 yuan has an annual car insurance premium of 7,000-8,000 yuan, while the new Maserati car (fuel car) priced at 680,000 yuan has a first-year premium of only 6,000 yuan?

At present, the domestic auto insurance market seems to have fallen into a vicious circle of "car owners buy expensive, insurance companies sell losses", and the price of new energy vehicles and traditional fuel vehicles and car insurance premiums are seriously inverted, resulting in long-term "expensive insurance and difficult to renew insurance" for new energy vehicle owners. In recent years, new energy vehicle companies and Internet insurance platforms have begun to set foot in the traditional auto insurance market, trying to solve the problem from the two key links of "car" and "people", and reduce the premium of new energy vehicle insurance a little bit and then a little bit.

Car owners and insurance companies "lose lose"

"It is the consensus of the industry that the car insurance of new energy vehicles is expensive." Some time ago, Zhang Yiwen, the head of the new energy vehicle business of Ant Insurance Car Insurance, visited the Xiaomi SU7 experience store and the Maserati 4S store next to it, he told reporters: "The same new car, SU7 is very cost-effective, as long as more than 200,000, Maserati new cars at least 650,000 start, but the price of car insurance is just the opposite, SU7 costs seven or eight thousand per year, Maserati only six thousand." He roughly calculated that if the premium ratio of the same car price is viewed, the car insurance of new energy vehicles is nearly twice that of fuel vehicles.

On May 10, visitors to the China Brand Day visited the Xiaomi SU7 show car. Photo by Xinhua News Agency reporter Fang Zhe

According to media reports, since the beginning of this year, many new energy vehicle owners have responded that the premium has risen significantly, even if there is no insurance, the renewal premium has also increased slightly, and last year, once the insurance was out of insurance, the price of the insurance company increased by nearly 2 times, and the third-party liability insurance also rose sharply.

Judging from the information disclosed by the listed insurance company, the increase in car insurance premiums last year mainly benefited from the growth of new energy vehicle insurance, and in terms of claims, the insurance rate of new energy vehicles was twice as high as that of fuel vehicles, and the loss ratio was about 10% higher than that of traditional fuel. According to other data, the average premium of new energy vehicles in 2023 will exceed 4,000 yuan, and the average premium of fuel vehicles will only be more than 2,000 yuan.

With the rolling development of the new energy vehicle industry and the high premium collection, are insurance companies making a lot of money?

"The reality is that car owners have paid a lot of money, but the insurance industry is miserable." Zhang Yiwen told reporters that the comprehensive cost of new energy vehicle insurance is rising every year, and only in 2022, affected by the epidemic, the degree of traffic control is high, and the insurance company can barely break even, but with the recovery of private car travel, losses will also follow. Zhang Yiwen investigated three leading auto insurance companies, and the basic loss of new energy vehicle business in 2023 is 5%-10% (comprehensive cost ratio), "Fortunately, their fuel vehicle business is very large, and the overall car insurance business is still making money."

The Shenwan Hongyuan report also shows that the loss ratio of new energy vehicle insurance is close to 85% on average, and the new energy vehicle insurance business of most insurance companies is on the edge of the profit and loss line, and the loss pressure is greater.

According to Annana, head of pricing at CPIC's property and casualty insurance marketing department, although the growth rate of the new energy vehicle market is amazing, data accumulation is still limited, and customers' ability to accurately identify risks is not as mature as that of fuel vehicles. "At the same time, the new energy vehicle has a high degree of intelligence, and the performance of the emergency braking and deceleration is different from that of fuel vehicles, and some new energy vehicles have an operational nature, and a variety of factors superimpose to double the insurance rate of new energy vehicles, and the insurance company's loss ratio is too high, and the premium cannot be reduced."

There is another aspect that should not be overlooked. The "three electrics" system (battery, motor and electronic control system) of new energy vehicles has a high degree of integration, and in the event of a traffic accident, some parts can only be repaired and replaced, and the overall maintenance cost is also rising. In particular, due to the small audience and lack of data statistics for individual models, in order to cover the risks, insurance companies can only significantly increase the premium or even refuse to insure.

"New players" have hundreds of dollars cheaper premiums

For example, the stability of the "three electrics" system is the key to the car end, and the information such as the driving habits of the car owner is the lifeline of the human side.

In order to get rid of the situation of "car owners buy expensive, insurance companies sell at a loss", new energy vehicle insurance must make a breakthrough in "car" and "people".

On the "car" side, the car companies themselves are undoubtedly the ones who know the car best, and there are more "new forces" that do car insurance.

On May 6, BYD Property Insurance was approved to use the national unified compulsory traffic insurance terms, basic insurance rates and corresponding rate floating coefficients in eight regions across the country. BYD Property Insurance is currently the only property insurance company in mainland China that is 100% controlled by new energy vehicle companies.

Almost at the same time, new energy vehicle companies such as NIO, Xpeng, and Li also set up or acquired insurance intermediary licenses to "intervene" in the auto insurance market. NIO acquired HITOP Insurance Brokers and changed its name to NIO Insurance Brokers, and Ideal obtained an insurance brokerage license through the acquisition of Yinjian Insurance Brokers.

Although the threshold of the "insurance broker" license is not as good as that of the car insurance license, the entry of new energy vehicle companies has created a broader imagination space for the car insurance market. After all, with their own technical advantages, car companies have a better understanding of the risk status of new energy vehicles, which also brings more scientific research and judgment to the risk assessment of car insurance.

In other words, BYD has confidence in its own new energy vehicles, so under the same conditions, BYD's property insurance for its new cars will obviously be lowered.

On the "people" side, the insurance company has increased its cooperation with the Internet platform, which aggregates a large number of car owners' risk information, which has also become an important part of the insurance company's auto insurance pricing.

It is reported that a number of insurance companies such as PICC Property Insurance, Ping An Property Insurance, and Pacific Property Insurance have cooperated with the Internet insurance agency platform "Ant Insurance" to jointly develop and launch the "joint pricing" technology of car insurance, which realizes more accurate car insurance pricing from the two dimensions of "car" and "person", and makes it cheaper for car owners with good driving habits to insure while improving the operational efficiency of insurance companies. Last year, it was first applied to new energy vehicles, and is now gradually covering fuel vehicles. Operational data shows that "co-pricing" insurance quotes can be hundreds of dollars cheaper on average.

Ant Insurance has worked with a number of insurance companies to develop "joint pricing" technology.

Zhang Jiyuan, head of actuarial science at Ant Insurance, said that the pricing of traditional insurance companies is basically limited to car data, taking Tesla in Shanghai as an example, insurance companies basically give a fixed coefficient of "benchmark price × 1.1", "even if my driving skills are 'old drivers are as stable as a dog', I still have to face the problem of rising prices."

Annana looks at the importance of "human" information from the perspective of the insurance company, which only has the basic information of the car and the owner, and relies on the preliminary judgment of the owner's age, gender, and insurance situation. Now, through the car owner information accumulated with Alipay, the insurance company can more comprehensively judge the driving habits and violations of the car owner. "For example, the customer is a white-collar worker in the company, two points and one line at work, and the frequency of vehicle use is low, and the customer risk is refined on the basis of supplementary information, and the original car insurance price is 4,500 yuan, and now it is estimated that 4,000 yuan is enough." Annana believes that with more risk dimensions, high-quality customers deserve lower car insurance prices.

In terms of the protection of car owner information, the insurance company and the platform are also exploring the application scenarios of "privacy computing". Ananna explained to reporters that the car owner's car insurance information is in the insurance company's database, and the owner's Alipay information is also in Alipay's database, and the two sides have cooperated to deploy an intermediate server, and the modeling interactions in the server are encrypted, and the final results are returned to the databases of both parties, so as to realize "data does not leave the database" and thus protect the security of customer information.

New Deal Encourages "Precise Pricing Power"

According to the latest data from the China Association of Automobile Manufacturers in April, the production and sales of new energy vehicles reached 870,000 units and 850,000 units, respectively, an increase of 35.9% and 33.5% year-on-year, respectively, and the market share reached 36%. According to iResearch's White Paper on the Co-construction of China's New Energy Vehicle Insurance Ecosystem, the profit value created by the automotive after-sales service market usually accounts for 50%-60% of the automotive industry chain, which is much higher than that of automobile manufacturing. The auto insurance market is undoubtedly one of the fat big cakes, and the policies are also constantly promoting the benefits.

As early as 2021, the Insurance Association of China issued exclusive terms for commercial insurance for new energy vehicles, guiding the insurance industry to include the "three electrics" system in the scope of new energy vehicle insurance and protect the loss of self-use charging piles, providing more effective and targeted insurance protection for new energy vehicle consumers. Recently, the State Administration of Financial Supervision issued the Notice on Promoting the High-quality Development of New Energy Vehicle Insurance (Draft for Comments), one of the important contents of which is to relax the range of independent pricing coefficients for new energy commercial vehicle insurance of insurance companies.

According to the Consultation Paper, the range of independent pricing coefficients for new energy commercial auto insurance will be adjusted from the original [0.65-1.35] to [0.5-1.5], calculated according to the formula of "commercial auto insurance premium = benchmark premium×NCD coefficient (no compensation preferential coefficient) ×independent pricing coefficient", it can theoretically be concluded that the adjusted premium price of new energy vehicle insurance can be reduced by up to 23% and up to 11%.

This means that insurance companies will have greater autonomy in pricing and can make more precise pricing based on factors such as vehicle risk profile and vehicle owners' driving habits.

Guosen Securities Research Report pointed out that the "Consultation Paper" further expands the floating range of independent pricing coefficients of commercial auto insurance, improves the profitability of insurance companies underwriting new energy business, optimizes the supply of new energy vehicle insurance products, and further optimizes the underwriting profit margin of new energy vehicle insurance in the industry. The industry generally believes that after the liberalization of the independent pricing coefficient range, insurance companies will make the premiums of high-quality customers go down and the premiums of high-risk customers go up through accurate pricing, so as to achieve breakeven, and at the same time, it will also force insurance companies to improve their accurate pricing capabilities.

At present, the range of independent pricing coefficients of new energy commercial vehicle insurance has been on par with that of fuel vehicles.

Wang Xiangnan, deputy director of the Insurance and Economic Development Research Center of the Chinese Academy of Social Sciences, said that the lack of "accurate pricing power" is the main reason for the loss of auto insurance business, especially new energy vehicle insurance. Previously, car insurance pricing was more based on car factors, such as vehicle model, vehicle age, vehicle integer ratio, value retention rate, etc. However, whether there is a risk or not, it is often the human factor that plays a decisive role, such as the driving skills and habits of the car owner.

Now, with the support of industry policies, the introduction of new technologies such as "joint pricing" of auto insurance may be able to improve the problem of auto insurance losses from the source, and promote the marketization of commercial auto insurance rates and the sustainable development of auto insurance business.

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