China: Health insurance sales hit by crackdown on universal products
Source: Asia Insurance Review | Sep 2017
Brunei Life & Health
Health insurance premium growth has slowed in China for the first six months of this year, indicate data from CIRC. Health premiums increased by 10.9% to CNY261.6 billion (US$39.2 billion) in the first half compared to the corresponding half last year.
In contrast, the growth rate of the health business in the first six months of 2016 and 2015 was around 89.4% and 39.5% respectively.
The slowdown in the pace of growth this year has been obvious. In January-February, the growth rate was 42.3% compared to the corresponding months of the previous year; from January to March, the rate dipped to 36.9%; followed by 24.1% for January to April; and 17% for January to May.
The reason for the slowdown has been attributed to regulatory action. The rapid surge in 2015 and 2016 was due to sales of universal insurance products that were more investment in nature than health protection. The CIRC started cracking down hard on short-term high-cash-value universal product sales last September.
Overall, the insurance industry in China posted gross premiums of CNY2.3 trillion for 1H2017, representing growth of 23% over the first half last year. A