Baidu and German insurer Allianz agreed yesterday to launch an online insurance joint venture in China, following an online banking venture that Baidu formed with Citic Group earlier this month.
The joint venture, Bai'an Insurance, will apply for a nationwide license to sell insurance policies online. It is waiting for regulatory approval to start operation.
Bai'an Insurance is expected to offer coverage for travel, e-commerce, Internet finance, short-term health, lifestyle and potentially also motor insurance in the future, according to a corporate statement.
"We hope to leverage more new technologies such as cloud computing and artificial intelligence to help drive innovation in the insurance industry," Baidu Chairman and CEO Robin Li said in Shanghai.
George Sartorel, CEO of Allianz Asia-Pacific, called the agreement a milestone for a completely new model of insurance that uses Big Data capacities.
Bai'an Insurance will also include investment from venture capital firm Hillhouse Capital.
But the three parties didn't reveal the stake each will hold in the new venture.
Sarah Butler, an insurance expert and China chairman of consulting firm Strategy&, said the Allianz joint venture brings access to global best practice capabilities as well as the potential to expand beyond China into global markets together with a strong partner.
"As the China market grows and matures, many of the capabilities foreign players have developed in their home markets are becoming very relevant for China," she added.
Latest data showed that China's online insurance premiums were 81.6 billion yuan (US$12.8 billion) in the first half of this year, nearly tripled from the same period of last year.
