Reg­u­la­tor calls foul on­World Cup ‘re­gret’ in­sur­ance

China Daily (Canada) - - BUSINESS - By SHI JING in Shang­hai shi­jing@chi­nadaily.com.cn

The in­sur­ance reg­u­la­tory body on Thurs­day halted the sale of in­sur­ance prod­ucts that carry a whiff of lot­tery at a time when many con­sumers are press­ing their luck on the on­go­ingWorld Cup.

In an an­nouncem e n t re­leased on its of­fi­cial web­site, theChina In­sur­ance Reg­u­la­tory Com­mis­sion said it has banned in­sur­ers from de­vel­op­ing and sell­ing prod­ucts that ex­hibit char­ac­ter­is­tics of gam­bling or chance, re­it­er­at­ing that in­sur­ance prod­ucts must strictly ad­here to the coun­try’s In­sur­ance Law.

Shortly be­fore the global soc­cer event de­buted, Chongqing-based Ancheng Property & Ca­su­alty In­sur­ance Co Ltd started sell­ing so-called “World Cup re­gret” in­sur­ance at its Tmall store, which is the B2C plat­form of Alibaba GroupHold­ing Ltd. The in­sur­ance prod­ucts, which sold for 8 yuan ($1.20) apiece, held that if a team was elim­i­nated in a cer­tain round, the buyer would be en­ti­tled to a claim of up to 49 yuan.

On Thurs­day, no World Cup-re­lated in­sur­ance prod­uct could be found in Ancheng’s Tmall store. Ac­cord­ing toHuangXiao, gen­eral man­ager of Ancheng’s e-com­merce depart­ment, the com­pany stopped sell­ing the prod­ucts on Wed­nes­day. But he would not say whether that ac­tion was re­lated to the reg­u­la­tory body’s lat­est pol­icy.

Still avail­able on Tmall, how­ever, were World Cup-re­lated prod­ucts of­fered by Shang­hai-based Zhong An In­sur­ance Co Ltd. If a con­sumer buys its “get­ting drunk” in­sur­ance for 3 yuan and has an al­co­hol-re­lated in­ci­dent dur­ingWorld Cup play, he will re­ceive 200 yuan for an emer­gency call and 2,000 yuan to­ward hos­pi­tal­iza­tion ex­penses. The “night owl” in­sur­ance, also for 3 yuan, pro­vides the same com­pen­sa­tion for an acute up­per re­s­pi­ra­tory in­fec­tion dur­ing the games. And the “soc­cer hooli­gan” in­sur­ance of­fers the same com­pen­sa­tion if the buyer gets robbed or phys­i­cally hurt dur­ing the games.

The prod­ucts from Zhong An seem pop­u­lar: Each one has re­ceived at least 300 or­ders in the past few days, with some get­ting more than 1,000.

Ac­cord­ing to Ge Ruichao, di­rec­tor of the fi­nance depart­ment of Taobao, a pop­u­lar on­line­mar­ket­place of Alibaba, Taobao only serves as a plat­form on which in­sur­ers can sell their prod­ucts. All they can do is­make sure that ev­ery­thing sold on Taobao is le­gal.

But he added that var­i­ous kinds of in­sur­ance prod­ucts sold on­line will go a long way to­ward ed­u­cat­ing con­sumers about the essence and value of in­sur­ance, as ev­ery prod­uct sold on­line is dis­played with user re­views.

“But it will take some time be­fore the ma­jor­ity of con­sumers can ac­cept and un­der­stand the new prod­ucts in­tro­duced to them,” he said.

Mark Bain, di­rec­tor of KPMGChina, said that a reg­u­la­tory agenda that fo­cuses on pro­tect­ing con­sumers and im­prov­ing the range of prod­ucts avail­able on di­rect sales chan­nels in both the life and gen­eral in­sur­ance sec­tors has helped im­prove cus­tomer ex­pe­ri­ence in China.

“In­sur­ance-buy­ing de­ci­sions are in­creas­ingly in­flu­enced by ‘peer re­view’ on the Web and so­cial chan­nels,” Bain said, “which, in turn, cre­ates new op­por­tu­ni­ties for in­sur­ers to dif­fer­en­ti­ate them­selves.”

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