[Asia Economy Reporter Oh Hyung-gil] Samsung Fire & Marine Insurance is converting its Chinese subsidiary into a joint venture through equity partnerships with local internet companies after 15 years of entering the Chinese market. Local investors, including Tencent, a leading Chinese internet company, are reportedly investing approximately 320 billion KRW to establish the joint venture.
On the 26th, Young-moo Choi, CEO of Samsung Fire & Marine Insurance, signed a contract to establish the Chinese joint venture with executives from investors such as Tencent. The signing ceremony was held via video conference due to the COVID-19 pandemic.
After converting the Chinese subsidiary into a joint venture, the shareholding structure will be Samsung Fire & Marine Insurance 37%, Tencent 32%, Shanghai Jia Yin 11.5%, Wishing Technology Company 11.5%, Shanghai Tian Tian 4%, and Bowei Fund 4%.
Samsung Fire & Marine Insurance, which established the first wholly foreign-owned subsidiary among overseas insurers in the Chinese non-life insurance market in 2005, explained that it partnered with Chinese investors such as Tencent to overcome the limitations as a foreign insurer and pursue more meaningful growth. Additionally, it plans to implement further growth strategies utilizing the platforms of its partners.
The Chinese non-life insurance market is rapidly growing, centered on personal insurance. The joint venture plans to expand its business area into online personal insurance by leveraging Tencent’s 1.2 billion customers and robust IT infrastructure on top of its existing business foundation.
The joint venture will be operated under a co-management structure, and early next year, it plans to submit application documents for shareholder changes and capital increase to the Chinese regulatory authorities and obtain approval.
A Samsung Fire & Marine Insurance official said, "We have established a solid foundation for business expansion in the Chinese insurance market," and added, "We will continue efforts to achieve results in overseas markets."
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