Leading domestic insurance intermediaries go overseas collectively: the layout of Hong Kong refers to Southeast Asia, and technology export has become the first choice

The domestic market is difficult and volatile, but what about the international market that has yet to be deeply mined?

In fact, in recent years, it has become a trend for domestic enterprises to go overseas, especially the Internet and clothing companies represented by Tiktok and Shein have achieved obvious international influence, and they have successfully promoted the business models verified in China to the world.

When it comes to the history of the insurance industry, it is not really new, but in the early days, it was dominated by large state-owned enterprises, and then gradually expanded to large private enterprises, and recently the protagonist has further evolved into an insurance intermediary giant. In recent years, under the pressure of industry transformation, especially under the further big waves of the implementation of policies such as "integration of newspapers and banks", the insurance intermediary track is significantly differentiated, and a new development direction is needed.

Overall, Hong Kong is everyone's first choice, and different companies have joined the Hong Kong insurance market through different layouts, and the explosive growth of Hong Kong insurance in 2023 has also brought a positive impact on their performance. But not only Hong Kong, but also Southeast Asia and even the wider world, focusing on this part of the so-called "China of 20 years ago", with the intention of replicating the domestic model to open up a larger market.

So what do these intermediary leaders think and do? "Huibao World" has sorted out the overseas actions of several companies such as Pan-China, Huize, and Shuidi in recent years, and found that everyone has some commonalities and many differences, but the most important thing is actually the difference in the way of going to sea. Here are three representative cases:

01

Pan-China: Introduce 500 million US dollars of foreign capital to increase international expansion, and enrich business imagination with multiple capital operations

In October 2007, as the "first insurance intermediary stock in Asia", Pan-China was successfully listed on the NASDAQ in the United States, and its capital operation ability is also obvious to all in the industry. However, after the highlight, like other intermediaries, it is facing industry problems, and its answer ideas can be seen from a series of actions.

Among them, the most noteworthy is that on February 20 this year, Pan-China disclosed a strategic investment framework agreement with Huade Group, a Singaporean investment and development company, which involves three aspects:

1. Huade Group will help Pan-China achieve intelligent development by injecting assets, and achieve international expansion by helping Pan-China set up offices in Singapore, Vietnam, Europe, the United States and Hong Kong, China.

2. Huade Group and its partners will invest US$500 million in Pan-China.

3. The two companies will focus on investing in high-quality assets, including a telemedicine service platform based in Asia and a hardware manufacturer of AI intelligent bionic robots in Singapore.

The agreement clearly reveals Pan-China's ambitions for future international expansion – it will set up offices in Singapore, Vietnam, Europe, the United States and Hong Kong, but it can also be seen that its focus is still on the Southeast Asian market, but the first and best place to land is in Hong Kong. In October 2023, Pan-China Holdings announced a strategic partnership with Asia Insurance Company Limited to form two joint ventures, including an insurance brokerage company and an insurtech company, both of which will be headquartered in Hong Kong.

In fact, Pan-China has always been the vanguard of intermediary transformation, and its extremely good use of capital operation can be used as a weather vane to observe the insurance intermediary market. At the end of 2022 and in 2023, Pan-China and Zhongrong Huijin, Zhongji Insurance Agency, and Wuhan Taiping Insurance Agency implemented the "open platform" strategy through share swaps; In addition, it has also carried out a series of capital operations, including a share swap with Puyi Group, a third-party wealth management service provider, and Puyi has become the controlling shareholder of Pan-China; Introduced investment from New Dragon Group (Far East) Limited, a Hong Kong-based investment management company, and a Singaporean consortium in February this year.

At that time, the combination of Pan-China and Puyi Group, Puyi Group called it to create a "Chinese version of LPL", which fully covered all elements of LPL of insurance + trust + fund, and had a market-wide product shelf. LPL Financial is a comprehensive financial intermediary company in the United States, the largest independent broker-dealer in the United States, the third largest custodian and the largest third-party service provider for financial institutions. However, the times, policies and market backgrounds are very different, and it is difficult to conclude whether Pan-China can move towards LPL in the short term.

02

Wise: While continuing to expand the Hong Kong market, it has accelerated its layout in Southeast Asia, and has officially entered the Vietnamese market through acquisitions

While announcing the fourth quarter and full year results of 2023, Ma Cunjun, Chairman and CEO of Huize, made it clear: "In the future, we will continue to expand our business in the Hong Kong insurance market, and actively explore the development opportunities of the insurance industry in emerging markets in Southeast Asia, so as to replicate the business model to gain a more diversified market share and revenue structure, and achieve the goal of achieving a double-digit revenue contribution rate in the international market by 2024." ”

The Hong Kong insurance market business, which will continue to expand, has made a significant contribution to Huize's performance in 2023, and the contribution of Huize's Hong Kong insurance brokerage business to total revenue reached 6% in the fourth quarter. Specifically, its practices include cooperating with CPIC Life Insurance Hong Kong and other insurance companies to customize mainstream products and extend the product chain; At the same time, it will further expand its Hong Kong insurance brokerage business and provide high-end insurance services for high-value users.

As a next step after Hong Kong, Huize chose Vietnam, known as the "China of Twenty Years Ago," to begin replicating what it believed was a viable digital insurance model. On June 20, the company announced the acquisition of Global Care, an insurtech company in Vietnam, to officially enter the second international market. It is reported that Global Care was founded in 2017 and focuses on digital transformation solutions for the insurance industry, and in 2023, the Global Care platform facilitated 13.5 million policies, revenue increased by more than four times year-on-year, and registered users increased by more than 1.3 million.

The reason for choosing Vietnam is very clear, the data shows that in 2022, the average insurance penetration rate of emerging markets in Asia is 3.6%, and the life insurance penetration rate is only 2.1%, of which the insurance penetration rate in Vietnam and Indonesia is even lower to 1%~2%. At the same time, Southeast Asia shares similar market characteristics to China, including a fast-growing economy, a large and young population, an urbanized middle class, and a growing demand for digital insurance solutions, which play a crucial role in business model replication.

At the operational level, according to the transaction documents, Huize will complete the acquisition of a controlling stake in Global Care in several installments through its newly established international subsidiary, Poni Insurtech, by purchasing existing shares and subscribing for new shares. At the same time, VinaCapital Group, a Vietnamese investment management company, will acquire a new issue of shares of Huize through its technology investment platform, VinaCapital Ventures, as part of the consideration. At the same time, the acquisition of Huize will accelerate the development of its international brand Poni Insurtech into a pan-Asian digital insurance distribution platform.

03

Water Drop: Renaming, continuous relocation to increase Hong Kong insurance business, in 2018 took advantage of the trend to lay out the payment field in Southeast Asia

Regarding the Hong Kong market, it is reported that as early as 2021, Yang Guang, the co-founder of Water Drop, expressed optimism about the Hong Kong market, and since Water Drop was not listed at that time, he also expressed his expectations for the Hong Kong capital market. And in 2023, under the hot insurance in Hong Kong, water drops will also move frequently:

In January 2023, Shuidi changed the name of its licensed insurance brokerage company in Hong Kong "Huabert Financial Services" to "Shuidi Financial Services (Hong Kong)", and Shen Peng, CEO of Shuidi Company, said in an interview that Shuidi is a technology company that has accumulated rich experience in digitalization and intelligence in the insurance industry, and believes that Hong Kong's insurance companies also have the need to improve digitalization, and Shen Peng also said that Shuidi is continuing to pay attention to the development opportunities in the Hong Kong market.

In August 2023, the Hong Kong office of Water Drop Financial Services was officially put into use. At the opening ceremony of the new location in March 2024, Yang Guang, co-founder and head of the international business department of Shuidi Company, said that the opening of the new workplace is an important milestone for the company's development in Hong Kong.

In addition to the already crowded Hong Kong insurance market, in 2018, Shuidi Mutual, a subsidiary of Shuidi, also strategically invested in Singapore's local mobile payment application SpherePay with Extraordinary Funds, BIB (Blockchain Investment Bank) and other institutions.

Founded in November 2017, SpherePay's all-in-one mobile app allows consumers and businesses to make cashless payments and P2P transfers, and in December of the same year, it announced regional expansion in Indonesia and Thailand, followed by further expansion in Singapore, Malaysia, the Philippines, Vietnam and Cambodia in the second quarter of 2018. By investing in SpherePay, Shuidi can also carry out network promotion on the one hand, and on the other hand, fully integrate the Southeast Asian business in the international version of Shuidi Chip business into SpherePay payment.

In addition, Shuidi also launched an international version of Deeda in Singapore in 2018, and it is reported that Shuidi positioned Deeda as a charity similar to Shuidi at that time, adopting a business model of cooperation with foundations, and the operation team was mainly locals.

In fact, in 2018, Chinese enterprises went overseas to set off a boom, which coincided with the 40th anniversary of China's reform and opening up, and also the five-year process node of China's comprehensive deepening reform. And whether it is from the founder or the business idea of the water drop with the Internet gene, but also chose to "move with the times", perhaps this is also just to summarize the water drop's idea of going to sea, now the most obvious trend in Hong Kong and Southeast Asia, then the focus of the water drop may also be in these places.