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Life insurer Old Mutual explores JV London-based Old Mutual, one of the world's oldest insurance companies, officially announced its decision last week in Beijing to enter the Chinese life insurance market. Although a latecomer compared to other multinational insurers, Old Mutual, established in 1845 in South Africa, believes China's insurance market is large enough for all major players to have a piece of the rapidly-growing pie. Hasan Askari, CEO of Old Mutual, said in an interview: "One of our strategic imperatives is to gain access to fast-growing markets and China has grown faster than any other region over the past decade." As a first step, it opened the Old Mutual Plc Beijing Representative Office in May of this year. According to Chinese re-gulations, a fo-reign insurance company is re-quired to open a representative office here first, then two years later it can apply for life insurance business operation after forming a joint venture (JV) with a Chinese partner. Askari said his company is currently seeking the needed Chin-ese partner for business. "We do not have any pre-conditions for the Chinese part-ner," he said. However, he noted the Chinese partner, no matter with a financial or industrial back-ground, must have a strong financial basis as insurance is a capital intensive business. Askari said his company will enter whatever size of investment required to launch their life insurance business in China and money is no problem. Askari said his company has rich experience in emerging markets, giving it an advantage in China. In 2001, it established a JV life insurance company in India. Currently, Old Mutual's JV in India has more than 6,800 life advisers operating from 41 branches in 30 cities. As a result, it recorded a premium income of more than US$35 million last year. "China and India are the two important markets in Asia for Old Mutual," Askari said, indicating his company's experience gained in India will be of help for future business expansion in the Chinese market. Old Mutual, a Fortune 500 company, was the 14th largest life insurance company by revenue in the world last year. |
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