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More insurance capital expected to flow into A-share mkt on policy support

2014-08-21 GMT+8:00

BEIJING, Aug. 20 (Xinhua) – China's domestic stock market is expected to see inflow of more insurance capital after the implementation of the government's fresh policies on the insurance industry.

The State Council, China's cabinet, launched guidance on speeding up development of modern insurance service industry on August 13, which spells out several targets for the insurance industry, including lifting insurance depth and insurance density as well as favored policies for the industry in the years to 2020.

The annual premiums of China's insurance industry are expected to rise from current two trillion yuan to some five trillion yuan by2020 inconsideration of economic growth and the industry's growth potentials, Shanghai Securities News on Wednesday quoted Chen Donghui, a senior official with PICC Property and Casualty Co., Ltd., as saying.

With the five-trillion-yuan premiums, the total assets of the insurance industry are estimated to hit 50 trillion yuan in 2020, which means that much more insurance funds are eligible for investing in the domestic stock market, said Chen.

Industrial insiders forecast that insurers' positions in stocks are expected to be raised from the present 10 percent to a maximum of 20 percent of their total assets if the reform on the capital market goes on and the A-share market regains strength. It means that insurers are likely to invest seven trillion yuan to ten trillion yuan into the stock market.  (Edited by Li Xueqing,