Chinese reinsurance firm PICC Reinsurance Company limited is getting a capital injection from its two owners, People’s Insurance Company (Group) of China Limited and its subsidiary PICC Property and Casualty (P&C) Company Limited.
The pair are contributing a combined RMB 2 billion (approx $303.4m) to increase the share capital of PICC Reinsurance, in the latest move showing the appetite to grow local companies for providing reinsurance coverage in China.
People’s Insurance Company is contributing RMB 1.02 billion ($154.7m) and PICC P&C RMB 980 million ($148.7m) to boost capital at the Chinese reinsurer.
After the capital injection, People’s Insurance Company’s shareholding of PICC Reinsurance will remain unchanged at 51%, with PICC Property and Casualty owning the other 49%.
PICC Reinsurance is primarily involved in underwriting commercial property reinsurance business, life reinsurance, short-term health reinsurance and accidental injury reinsurance, as well as providing services and consulting related to reinsurance products.
The reinsurer was established by its owners in 2016 and began underwriting this year, taking large shares of business from its parents, we understand.
The increased capital from this share capital increase will be utilised for supporting business development and improving the reinsurers solvency margin ratio, as well as boosting its cash on hand.
People’s Insurance Company of China said, that the boost in capital will, “Help PICC Reinsurance to further enhance its capital strength, improve its solvency, provide capital for its future business development and better perform its duties in serving as the Company’s professional reinsurance services and resources integration platform, international strategy implementation platform and new value creation platform.”
