Atlas Magazine February 2010

China: the long march

No sooner had 2009 gone than we started dreaming about 2010, the year meant to consolidate insurance which is coming through after two poor years.

The optimism that has been prevailing recently should not conceal a possible relapse, hence the need to remain vigilant.

For many observers, the year 2010 marks the beginning of a profound market restructuring. The big insurers and reinsurers, who are back to business, are aware that the crisis has altered the insurance landscape. Many signs are proving this upheaval, the first of which is the emergence of China as a future insurance pole.

In a few years, China's premiums will overtake those of the main European countries. The establishment of an Asian market around Beijing including Japan, South Korea, India, Vietnam is not an imagination but a plain reality.

This change of the insurable mass explains the rush of the great international insurers towards Asia.

The purpose is to get established as close to Beijing as possible and to be able to catch the new premium volumes. Singapore and Kuala Lumpur are poised to be dethroned by Beijing and Shanghai.

Small consolidation moves of Swiss Re or Allianz will not do. Instead, large-scale operations requiring a coherent strategy, a perfect logistics and enormous financial resources will take over. Henceforth, only the rich get richer.

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