Chinese insurers promise moon and more

CHINA - Singles can get compensated if they are not married within the next 12 months to China's "Singles Day" on Nov 11 next year.

Moon-gazers in some Chinese cities received 188 yuan (S$38.50) each in insurance payouts when the full moon did not show up in their patch of sky on Mid-Autumn Festival day in September.

And for spouses who want to safeguard against the intrusion of a third party into their marriage, they can buy "xiao san" (third party or mistress) insurance.

These are just some of the weird and wacky schemes some Chinese insurers have conjured up to boost their profiles - and profits - in a fiercely competitive industry.

Some proclaim such schemes as proof that Chinese players are going all out to answer top insurance regulator Xiang Junbo's recent clarion call at a major insurance summit in September for "more product innovation".

Others dismiss them as gimmicks. One netizen in an online forum said: "They distract insurers from addressing problems in their bread-and-butter products and in the overall industry."

In any case, the proliferation of schemes shows that the world's fourth-largest insurance market is finally coming of age, say analysts.

Capital University of Economics and Business insurance professor Tuo Guozu said: "After 30 years, China's insurance industry is finally starting to cater to the numerous customer segments."

Indeed, the industry has come a long way since the 1980s, when one single insurer - the People's Insurance Company of China, which was dissolved and split into four state-owned firms in 1999 - offered just a range of one-size-fits-all products.

Some 165 national insurers and seven reinsurers - along with hundreds of smaller outfits - have mushroomed across the country as the state allowed more players to enter the market.

And it is the sheer size and diversity of China's 1.3-billion population that offer the scope for local insurers to come up with novel offerings. Take unusual products like "moon-gazing insurance", for instance.

"For some, a full moon is actually very important for a family or business gathering," said Prof Tuo. "There are enough of such people in China to make it worthwhile to offer a tailored product."

The moon-gazing insurance attracted 5,154 buyers across 41 cities in China. The local media speculated that the insurer, Allianz China, could have pocketed up to 320,000 yuan in profits.

But other analysts say the industry cannot be considered mature until it improves its core products, such as life and car insurance, and addresses problems of fraud and weak regulation.

CIC Industry Research Centre analyst Huo Xiaohua said: "The government must speed up the development of strong regulatory mechanisms."

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