The Shanghai International Reinsurance Exchange has recorded nearly ¥4.4 billion (US$617.87 million) in insurance premiums traded during its first eight months of official operations, according to Chang Ming, assistant to the general manager at the exchange.
The value of outward insurance, where insurers transfer risk to other companies, reached ¥94.6 billion. Inward reinsurance, which involves accepting business ceded by other insurers, totaled ¥9.5 billion.
The exchange, launched in October in the Lin-gang Special Area of the China (Shanghai) Pilot Free Trade Zone, has registered 118 institutions with trading rights, including 90 domestic and 28 overseas entities.
The platform has attracted 26 domestic and international reinsurance institutions to Lin-gang, including operation centers for 21 reinsurance companies, a branch office, and four insurance brokerage branches.
In a report from China Daily, Chang said the rapid development is due in part to institutional innovations, such as the introduction of trading seats at the exchange.
Overseas institutions are permitted to provide offshore reinsurance services to Chinese clients without formal approval from central regulators, though they cannot establish permanent operations in China under these circumstances. The trading seats allow these companies to access Chinese clients more efficiently and reduce the cost of conducting business related to China, Chang said.
As of now, six overseas institutions, including those from the United Kingdom, Barbados, and the Democratic Republic of the Congo, have secured trading seats at the exchange. The exchange has also worked with Commercial Aircraft Corp of China, PICC, and Air Union Insurance Brokers to develop an overseas fleet insurance service mechanism.
Swiss Re projects China’s economy to grow by 4.6% in 2025, with the country’s insurance industry recording primary premium income of ¥4.79 trillion (US$653.3 billion) in the first three quarters of 2024, a 7.2% increase year over year. Reinsurance company assets in China rose 10.2% to ¥823.1 billion by September 2024, reflecting continued expansion and investment in the sector.
Policymakers in China remain focused on strengthening the insurance industry as a tool for economic resilience and managing financial shocks. Ongoing reforms and support for the sector are seen as key to building long-term stability and encouraging further growth, according to industry analysts.
Feng Xiao, deputy general manager of the reinsurance department at PICC, noted that demand for insuring overseas business by Chinese companies is increasing as China’s economy grows and the Belt and Road Initiative expands.
Feng said it is important for domestic insurers to participate directly in international markets and manage inward reinsurance business from Chinese companies abroad, as well as other international inward reinsurance, to help China engage in global risk governance.
Chang added that trading data at the exchange are transparent, traceable, and controllable. The People’s Bank of China has facilitated cross-border capital registration and reinsurance trading through free trade accounts. The central bank is also considering a new measure to allow overseas investment using inward reinsurance income.
China’s re/insurance industry continues to show growth momentum, with a 7.2% increase in primary premium income in 2024 and reinsurance assets up 10.2% from the start of the year.
What are your thoughts on this story? Please feel free to share your comments below.
