The logo of Tencent is seen at the headquarters of Tencent in Shenzhen city, South China's Guangdong province on 29 March, 2013. (PHOTO / IC / CHINA DAILY)
Chinese internet giant Tencent Holdings has expanded its range of insurance offerings after an insurance agency backed by it got the necessary approval.
The internet giant of over 900 million users already has a presence in the life and property insurance sectors and an insurance agency.
According to analysts, the insurance sector is poised for more activity as there would be more services that would integrate internet-based technologies and insurance in the future. The rapid advent of financial technology and growing demand for protection in China would fuel more interest in the insurance segment, they said.
ALSO READ: ZhongAn makes stunning debut
The insurance sector is poised for more activity as more services are on their way of integrating internet-based technologies and insurance in the future
Weimin Insurance Agency, the Tencent-backed insurance agent firm, got the green light from the China Insurance Regulatory Commission on Wednesday. Tencent Holdings holds 57.8 percent stake in Weimin Insurance Agency, which has a registered capital of 200 million yuan (US$30 million).
Users of Tencent's social networks tools, such as WeChat and instant messenger QQ, would soon find Weimin embedded in their frequently used applications.
Besides Weimin, Tencent has invested in Zhong An Insurance, which offers both life and non-life policies. Tencent Holdings holds some 12.1 percent of Zhong An, which got listed in Hong Kong on Sept 28. Tencent also holds a 20 percent stake in global life insurer Aviva and a 15 percent share in Hetai Life Insurance.
"Big internet companies will not miss the opportunities brought by fast expanding demand for fintech services, particularly internet-based insurance," said Chen Maochuan, an analyst with Analysis International, a consultancy
and market information research provider.
"Internet companies aim to hold core assets, which are customer resources. They are not going to just stay as distributors. More moves will be made to fulfill demand in the entire supply chain of the insurance market," he said.
Other internet giants, such as e-commerce giant Alibaba Group Holding Ltd have been actively tapping the insurance market in recent years.
Alibaba-backed Ant Financial upgraded its insurance business group in 2016, creating an open platform that hosts some 80 insurance companies with more than 2,000 products. The company claimed that its insurance platform could reach 400 million people.
READ MORE: HK insurer introduces 2 new products
It also shares data with 18 insurers so that they can leverage these data for precise demand forecast and better risk control, said Xu Yan, operating general-manager of Ant Financial's insurance group.
For instance, the firm has launched a car insurance score ranging from 300 to 700, a range that is based on a car owner's user portrait and risk analysis.
"Demand for life insurance and non-life insurance will continue to expand fast in the next few years amid demographic changes, with more mobility and rising number of wealthy households that would need protection," said a research note from Zhongtai Securities.