People's Insurance Company of China

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The People's Insurance Company (Group) of China Limited, known as PICC Group or just PICC, is a Chinese listed insurer. The Chinese Central Government is the controlling shareholder.

The group contains the major subsidiaries: PICC Asset Management, PICC Life as well as PICC Property and Casualty (PICC P&C). The latter also listed on the stock exchange.

History

PICC was founded in 1949 as The People's Insurance Company of China (PICC; Template:Lang-zh),<ref name=prospectus/> as a subsidiary of the People's Bank of China.<ref name=book/> However, it was reported that PICC was disestablished in 1950. The People's Bank of China provided insurance directly, except from years 1952 to 1959, which the service was provided by the Ministry of Finance (MOF) instead.<ref name=book/> In 1965, PICC was re-established.<ref name=book>Template:Cite book</ref> In 1983, it was separated from the People's Bank of China as a separate entity that under the supervision of the State Council of the People's Republic of China.<ref name=book/> In 1985, People's Bank of China was the regulator, while the MOF supervised the financial reporting of the company; the Template:Ill was the state planner of the whole industry.<ref name=book/>

In 1996, it became a holding company, as People's Insurance Company (Group) of China (Template:Lang-zh).<ref name=prospectus/> Three subsidiaries were formed, as property insurer, life insurer and reinsurer respectively. However, in 1998–99, China Life and China Re were spin-off from the group,<ref name=prospectus/><ref>Template:Cite press release</ref><ref name=CIRC>Template:Cite press release</ref> while the overseas businesses, belongs to yet another former subsidiary, now known as China Taiping Insurance Group Limited (parent company of listed company China Taiping Insurance Holdings). After the split, The property insurer of the group assumed as the new holding company of PICC group, and named The People's Insurance Company of China again.<ref name=prospectus/><ref name=CIRC/> The regulator of the company, China Insurance Regulatory Commission, also established in 1998.<ref name=book/>

A new subsidiary PICC Property and Casualty (PICC P&C) was established in July 2003 (effective date backdated to September 2002)<ref name=prospectus/> from the former property and casualty insurance division of the PICC Group. PICC Group divested of insurance responsibilities, re-organized itself into PICC Holding Company (Template:Lang-zh) at the same time.<ref name=prospectus>Template:Cite book</ref> PICC P&C was first established as a subsidiary in 1996 but disestablished and merged back in 1999.<ref name=CIRC/> PICC P&C became a listed company in November 2003.<ref>Template:Cite news</ref>

PICC Holding reverted to the name People's Insurance Company Group of China (Template:Lang-zh) in 2007.<ref name=prospectus/> The company also re-incorporated as a joint stock company with limited liabilities in 2009, as The People's Insurance Company (Group) of China Limited (Template:Lang-zh).<ref name=prospectus/> In 2012, PICC's H shares were listed on the Stock Exchange of Hong Kong. It was followed by the A shares in 2018 on the Shanghai Stock Exchange.<ref>Template:Cite news</ref> US-based multinational insurer American International Group (AIG) was the cornerstone investor in the 2012 IPO,<ref name=AIG/><ref>Template:Cite news</ref> as well as in 2003 for the IPO of the subsidiary PICC P&C.<ref>Template:Cite news</ref>

Businesses

PICC has branch offices in London and New YorkTemplate:Citation needed as well as in the cities and towns of China.

PICC is selected by Fortune magazine as part of Fortune Global 500 since 2010.<ref>Template:Cite news</ref> As of 2019 edition, the company was ranked 121st.<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> The company also part of the Forbes magazine's Forbes Global 2000. As of 2019 edition, the company was ranked 155th.<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref>

PICC Property and Casualty

{{#invoke:Labelled list hatnote|labelledList|Main article|Main articles|Main page|Main pages}} PICC's subsidiary, PICC Property and Casualty (PICC P&C) is China's largest issuer of Property and casualty insurance. It is licensed to provide all major lines of insurance except life insurance. It is the designated agent within the Mainland China for most international insurance companies.Template:Citation needed As of 2018, the market share of PICC P&C in its sector is 33.0%.<ref name=PICC2018AR/>Template:Rp According to S&P Global Ratings citing China Insurance Regulatory Commission, PICC P&C's market share (by direct premium) in property and casualty insurance in the first half of year 2017 was 34.0% and ranked the first. The second was Pingan Insurance (19.6%).<ref name="S&P">{{#invoke:citation/CS1|citation |CitationClass=web }}</ref>Template:Rp

The People's Insurance Company of China (Hong Kong)

In Hong Kong, PICC has another subsidiary The People's Insurance Company of China (Hong Kong), Limited (Template:Lang-zh) for 75.00% stake.<ref name=PICC2018AR/>Template:Rp Fellow listed company Template:Ill is a minority shareholder as of 2018.<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> That subsidiary was formerly known as Peterson Insurance Company Limited (Template:Lang-zh) as well as Guangdong Asia Insurance Company Limited (Template:Lang-zh) before acquired by PICC in 2002<ref>Template:Cite news</ref> from Guangdong Holdings.<ref>Template:Cite news</ref> It provides non-life insurance.<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref>

PICC Life Insurance

In 2005, PICC formed a Sino-foreign joint venture PICC Life Insurance (Template:Lang-zh). Japanese insurer Sumitomo Life took 29% stake, followed by Hong Kong listed company Template:Ill (Hong Kong is considered as foreign investor in Mainland Chinese laws) and Thai listed company Bangkok Bank for 10% each.<ref>Template:Cite news</ref> However, after several capital increases, PICC owned PICC Life for 71.077% stake directly, plus additional 8.615% stake via non wholly owned subsidiary PICC P&C and 0.308% stake via wholly owned subsidiary PICC Asset Management as of 31 December 2018. The foreign investors only owned a combined 20% stake.<ref name=PICCLife2018report>Template:Cite report</ref>Template:Rp

The joint venture would sell insurance products, including savings-oriented endowment insurance policies.Template:Citation needed As of 2018, the market share of PICC Life in its life insurance sector is 3.6%.<ref name=PICC2018AR/>Template:Rp While according to S&P Global Ratings, PICC Life's market share (by policy written) in life insurance market in the first half of year 2017 was 4.3% and ranked 4th (10th in 2016).<ref name="S&P"/>

The insurance financial strength rating of PICC Life is A2 (as of 2019), according to Moody's Investors Service.<ref>Template:Cite press release</ref>

PICC Life also acquired 4.98% stake of Industrial Bank in 2012.<ref name=PICCLife2018report/>Template:Rp PICC via PICC Life and PICC P&C owned a combined 10.87% stake of the bank directly and indirectly at that time as the second largest shareholder. PICC also nominated Li Liangwen (Template:Lang-zh), President of PICC Life at that time, as a director of Industrial Bank in 2013.<ref name=PICCLife2018report/>Template:Rp He was replaced by Fu Anping (Template:Lang-zh) in both positions. Since 2016, PICC also owned a minority stake in Template:Ill. Chen Zhigang (Template:Lang-zh), vice-president of PICC Life, also nominated as a non-executive director in 2017.<ref name=PICCLife2018report/>Template:Rp

PICC Health Insurance

PICC Group has another subsidiary PICC Health Insurance Company Limited (Template:Lang-zh). In the first half of year 2017, the market share (by policy written) of PICC Health in life insurance market was 1.0%, ranked the 19th according to S&P Global Ratings.<ref name="S&P"/>

Founded in 2005, PICC Health was a joint venture with German insurer Template:Ill (for 19% stake; DKV is part of Ergo Group, itself owned by Munich Re) and other investors.<ref>Template:Cite press release</ref> However, as of 2018, DKV owned 2.2174% shares of PICC Health. Another Chinese company Capital Airport Holding owned 2.3342% shares. The rest of the shares of PICC Health were owned by PICC Group (for 69.3239%) and its subsidiaries, such as PICC P&C for 24.7262% and another subsidiary for 1.3983%.<ref>Template:Cite report</ref>

PICC Asset Management

PICC Asset Management ("PICC AM") is the investment arm of the company. This subsidiary is responsible for managing PICC's non-Renminbi assets, channelling cross-border investments, and handling the company's overseas investment.<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref>

PICC Capital

{{ safesubst:#invoke:Unsubst||date=__DATE__ |$B= {{ safesubst:#invoke:Unsubst||date=__DATE__ |$B= Template:Ambox }} }} PICC Capital Investment Management Company Limited (“PICC Capital”), a wholly owned subsidiary of the People’s Insurance Group of China, was established in July 2009. PICC Capital is the sole alternative investment platform of PICC Group, and the first asset manager in China’s insurance industry that specializes in alternative investment. PICC Capital takes a major role in strategic asset allocation and strategic resource acquisition for PICC Group. Leveraging on PICC Group’s brand, network and channels, PICC Capital provides financial resources to local governments and corporates by making investments in infrastructure, energy, inclusive financing, healthcare, technology incubation, etc., through debt investment and equity investment.

PICC Capital makes equity investments through its wholly owned subsidiary PICC Capital Equity Investment Company Limited (“PICC PE”). Approved by China Insurance Regulatory Commission in 2017, PICC PE is the sole private equity investment platform within PICC Group, and one of the sixteen PE fund managers in China sponsored by insurance capital. PICC PE currently manages an RMB 3bn PICC Health Care Fund.

PICC Re

PICC Group, via PICC Reinsurance, provided reinsurance service to its listed subsidiary PICC P&C.<ref>Template:Cite press release</ref><ref name=PICCRe>Template:Cite press release</ref> PICC Reinsurance (PICC Re; Template:Lang-zh) itself is a joint venture of PICC Group and its subsidiary PICC P&C in a 51:49 ratio.<ref>Template:Cite news</ref><ref name=PICCRe/>

Headquarters

The headquarters of the company is located in Template:Ill (or transliterated as PICC Building), in Xicheng District, Beijing. There are other office buildings that are named after PICC, such as in Guangzhou<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> and Chongqing (PICC Life Insurance Building).<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref>

Shareholders

PICC issued two classes of ordinary shares: A share and H share. The latter only traded outside Mainland China. Despite residents in Mainland China can buy the H shares of PICC via Shanghai-Hong Kong Stock Connect and Shenzhen-Hong Kong Stock Connect,<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref> and vice versa for foreigners buying A shares.

The Ministry of Finance of the People's Republic of China (MOF) is the controlling shareholder of the company, for 67.60% of the total shares as of 31 December 2018. The MOF also significantly owned fellow financial service companies: the Industrial and Commercial Bank of China, the Agricultural Bank of China, the Bank of Communications, China Cinda Asset Management and China Re, etc.<ref name=PICC2018AR>Template:Cite report</ref>Template:Rp The state pension fund: the National Social Security Fund (NSSF) also owned 8.60% + 1.19% total shares of the company (NSSF owned both A and H shares of the company) as of 2018.<ref name=PICC2018AR/>Template:Rp It was announced that MOF would transferred an additional 6.76% total shares of PICC to the NSSF in 2019.<ref>Template:Cite news</ref>

Other notable investors of PICC included the US-based multinational insurer American International Group (AIG), which owned 2.52% of the total shares (12.76% of the H shares) of PICC, as of 2018.<ref name=PICC2018AR/>Template:Rp However, AIG sold all their stake in February 2019.<ref name=AIG>Template:Cite news</ref> AIG also sold most of their stake in the subsidiary PICC P&C in 2005–06.<ref>Template:Cite news</ref>

The H shares of the company is the constituent of Hang Seng China Enterprises Index as of January 2020. While the A shares of the company is the constituents of Hang Seng China 50 Index, CSI 300 Index (and the subset the blue chip index CSI 100), SSE 180 Index (and the subset blue chip index SSE 50 since June 2019<ref>Template:Cite news</ref>), etc., as of January 2020.

External links

• Template:Official website Template:In lang