China market believed to have huge potential for foreign insurers
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With rapid development, China's insurance market has huge potential for foreign insurers, says Gerry Grimstone, chairman of Standard Life, the largest savings and pensions company in Britain.
"China is a very exciting market. I am a great enthusiast for China and a great supporter of China. I love the fact that we are part of the growth in China and try and sell products which are good for Chinese families," he said in a recent interview with Xinhua.
Standard Life currently runs businesses in nearly 50 cities in China and is one of the top five international companies in the market. The joint venture between Standard Life and Tianjin Taida is the largest of such kind in China.
"China will become an important part of our business, so I encourage my people to take an interest in China. I would like to have more of our people working in China," he said.
Speaking of China's efforts to boost its economy under the challenging economic conditions, he complimented the Chinese government's quick and sensible reaction to the global financial crisis, saying it has benefited the rest of the world.
"They will be grateful to the Chinese government for what it has done to stimulate the Chinese economy," he added.
While praising China as a very self-confident country at present, Grimstone also said China should welcome equal competition from international companies since it has strong and effective regulations.
At present, the total market share for the international insurance companies in China is about 5 percent, which is "very low" according to Grimstone. He suggested a more open market would help Chinese customers eventually.
But he also expressed his understanding of China's moderate pace of opening up the capital market as all governments and financial services are cautious about the speed at which foreign companies enter the market.
"The good thing about China is that the Chinese domestic insurance companies are also very strong," he said, "so we have good competition with them and we enjoy competing with them. It gives the customer good choice."
Asked about his development strategy in China, Grimstone said that he would open more offices in China and recruit more staff.
"We have an ambition to have offices in about 100 cities eventually in the next three or four years," he added.
He also said that more work has to be done in China in deciding what is best for the customer to sustain a long-term future for the business.
"The insurance industry relies upon long-term savings. The essence of insurance is trying to produce long-term value for your shareholders and your customers," he said.
According to his knowledge, China now has a very low percentage of people who have insurance.
"I am sure that the percentage will grow in the future," he said. The way to improve insurance in China is through better education of the customer and better training of the staff, he added.
When asked about the overseas expansion of Chinese companies, he said he hoped to see Chinese insurance companies, and eventually Chinese lawyers, Chinese accountants, in Britain.
"That's what world trade is all about," he said.
Grimstone told Xinhua he had traveled to China many times and had spent time traveling in the western part of China. He believes it is possible for his company to explore the market there.
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