Report Card of ＂Excellent Insurance Strategy＂ of PICC China： How to Accelerate ＂Running＂ in the Transition？

A stone stirs up a thousand waves.

On July 23rd, People’s Insurance Company of China (601319, Share Bar) announced that due to the needs of asset allocation and investment business of the National Social Security Fund, the Social Security Fund planned to reduce its shareholding by no more than 884 million shares within six months after 15 trading days, accounting for about 2% of the company’s total shares.

Superimposed on the many challenges faced by the insurance industry this year, as soon as this news came out, PICC Group, as the head insurance company in the insurance industry, immediately attracted great attention from the market.

"A Wisdom Insurance" learned from China PICC that China PICC is advancing the implementation of "excellent insurance strategy" in an orderly manner, and will continue to promote "excellent insurance strategy" and "six strategic services" in the second half of the year, strengthen scientific and technological empowerment, adhere to high-quality development, and strive to "submit papers" to shareholders with better performance.

The data shows that in the first half of this year, the net profit of China PICC increased by 25%-35% year-on-year, achieving rapid growth, and the premium income increased steadily year-on-year; The "excellent insurance strategy" implemented by the company has achieved remarkable results, which has attracted the attention and recognition of the capital market. The share price of H shares rose by 12%, which was higher than the Hang Seng Index and the average of peers, and the performance of A shares was also better than that of peers.

See the micro and know it. The transformation and development of PICC China in the difficult times of the industry deserves our attention and analysis. "A Smart Insurance" will strive to restore a more authentic and "running" China PICC to the market from the inside out.

Change and innovation

The transformation from "old people’s insurance" to "new people’s insurance"

In the second half of 2020, under the leadership of the new head, PICC China quickly launched a series of strategic seminars.For PICC China, the eldest son of the Republic, this transformation must be in line with the development of the times and its own positioning. In the context of a slightly depressed industry, the importance and priority of this transformation will definitely exceed the past, because it may be related to the future of PICC China.

At the 2020 annual strategy seminar, PICC China finally defined this transformation strategy as "excellent insurance strategy". According to Luo Xi, the chairman of PICC China, the strategic points of "excellent insurance strategy" are to focus on the main business, pursue first-class, pay attention to ability and comprehensive service, while the connotation of "excellent" is to lead global property insurance, manage all kinds of risks, implement global services, build industrial ecology, use modern technology and be among the best in performance. Strategy is a beacon, a guide and a goal, and around the "excellent insurance strategy", China PICC Group has launched a series of changes and innovations.According to "A Smart Insurance", the major transformation actions at the group level mainly include five aspects:

○ Establish the strategic plan for the development of PICC China in the 14th Five-Year Plan and the long-term goal to 2035, and clarify the path to return to the C position in the industry.

○ Implement strategic projects to meet national needs, customer needs and the company’s own product business capabilities.

○ Strengthen the empowerment of science and technology, study and formulate the Group’s informatization construction plan and the reform plan of science and technology management system and mechanism, and strengthen the front-line efforts of science and technology empowerment.

○ Improve the governance system, improve the "three meetings and one layer" governance structure, improve the parent-subsidiary corporate governance system, and promote the new round of institutional reform of the Group, and streamline the corporate departments of the Group from 19 to 14.

○ Transform corporate culture, unite the consensus of "returning to the C position" internally, adhere to customer orientation, market orientation and performance orientation, and accelerate the deep transformation and make up lessons of corporate culture of PICC China.

At the subsidiary level, the implementation of "excellent insurance strategy" is also put in an important position.Since the beginning of this year, the management of PICC P&C Insurance and PICC Life Insurance has changed, and the new leadership team has been pushing forward the strategic transformation nonstop after taking office.

PICC P&C has withstood the pressure of comprehensive reform of auto insurance, digested the historical burden of financial business, and demonstrated the resilience of contrarian development. It is reported that PICC P&C has formulated a "three bays adaptation" plan focusing on future development in accordance with the requirements of the group, taking customers as the center, adjusting the operational formation, promoting innovation and changes in various fields such as organization and management, operation planning, operation processes, products and services, and supporting maximum customer acquisition; Constantly digest the historical burden, promote anti-counterfeiting impairment, get rid of the growth dependence on policy business, and vigorously promote the development of commercial and non-business business.

In the period of deep adjustment of the industry, PICC Life Insurance also showed strong resilience. In terms of business structure, the wholesale premium continued to drop, and the proportion of future premium increased to 77.5%; In terms of geographical distribution, some provinces and cities have achieved positive growth in premiums and standard premiums; In terms of profitability, the net profit of PICC Life Insurance maintained rapid growth. In addition, in the first half of the year, PICC Life Insurance solidly promoted the "Rock Plan", resolutely retired false manpower, and constantly consolidated the team foundation. In June, effective manpower and other indicators stopped falling and rebounded.

The charge of "returning to the C position" has sounded. With the strong implementation of the "excellent insurance strategy", PICC China is insisting on high-quality development, striving for the gorgeous transformation from "old people’s insurance" to "new people’s insurance", and at the same time handing in a satisfactory answer for the market.

Strategic service

Six pillars go hand in hand

The development of a company should conform to the general trend of the times, follow the guidance of national policies, and find its own position in the industry. For PICC China, it is very important to find the development point of business resources and the focus of innovation and development. Only with forward-looking business strategic objectives can we make clear the direction for the company in the future changes of the industry and provide strong guidance for sound and rapid development.

It is reported that PICC China defines rural revitalization, smart transportation, healthy old-age care, green environmental protection, scientific and technological innovation and social governance as "six strategic services", and actively participates in strategic emerging industries, scientific and technological innovation and green environmental protection by giving full play to the functions of insurance risk protection and capital utilization, so as to support and serve the economic and social development.

After the overall poverty alleviation and the realization of a well-off society, the work of agriculture, countryside and farmers has historically shifted to the strategy of comprehensively promoting rural revitalization. As a leader in the insurance industry, PICC China,Actively explore for vigorously supporting rural revitalization.Plan and implement rural revitalization insurance solutions, basically build a "rural insurance" business system, and improve the quality of rural insurance supply. In the first half of the year, the premium income of agricultural insurance increased by 15.8% year-on-year, and the premium income realized by rural power grid institutions increased by 8% year-on-year.

In terms of serving intelligent transportationChina People’s Insurance Co., Ltd. has innovated and developed new auto insurance such as IOT operating vehicles, improved traffic management services such as "police-insurance linkage", prospectively studied emerging insurance products such as new energy vehicles, and made active explorations in promoting the transformation and upgrading of auto insurance on the "cloud wisdom" monitoring platform of innovative engineering vehicles in Taizhou, Zhejiang.

With the deepening of aging, pension has been raised to the level of national policy, and health insurance has become an important strategic growth point of the whole industry. Commercial pension insurance will usher in new opportunities, and China PICC will seize this window.Actively exert efforts to serve healthy old-age care.Innovate health care products such as Huimin Insurance, actively explore outpatient chronic and special disease protection in Baoji, Shaanxi, Zhangjiakou, Hebei, Zaozhuang, Shandong and other places, build a joint infirmary in Lu’ an Group, Shanxi, and make positive progress in promoting the exclusive commercial pension insurance pilot.

In the service of green environmental protectionChina PICC has explored some effective experiences and practices, such as environmental pollution liability insurance, green equipment insurance and green building insurance. In Nanping, Fujian, it launched the first forest fire insurance of "carbon sink loan" in China to support carbon sink financing; Explore the "green loan insurance" project in Huzhou, Zhejiang.

In terms of service technology innovationChina PICC has made new progress in the first set, the first batch, the first edition and technology insurance. For example, promote innovation in intellectual property insurance in Beijing, Sichuan and other places; Promote the inclusion of technology insurance products in the support catalogue of "Yangtze River Delta technology and finance Innovation Voucher" in Shanghai; In Jinhua, Zhejiang Province, the insurance of "revealing the list and taking the lead" was innovated to provide compensation for the loss of investment in R&D failed projects.

In terms of serving social governanceChina PICC took the lead in submitting a "service list" to 10 local governments, and paid attention to signing contracts and premiums on the one hand, which brought real premium income; Property insurance actively promotes the "urban insurance" project to provide overall solutions for urban social governance.

These six strategic services are by no means determined by "slapping the head", but in fact, it is China PICC’s profound insight into national policies and social development.Behind the rural revitalization strategy is the change of the country’s work policy of "agriculture, countryside and farmers", while the smart transportation strategy serves the background of a strong transportation country and smart transportation. The healthy old-age care strategy is a new opportunity to adapt to the aging trend of health insurance, and green environmental protection, scientific and technological innovation and social governance are all new service areas that must be deepened under the new development pattern.

With a vast insurance space, PICC China has seized the historical opportunity. If we can persistently make good use of the opportunity and adhere to the six strategic services, it will certainly bring new growth potential.

Technology empowerment

Transformation staged "acceleration"

Science and technology are constantly reconstructing insurance and gradually leading the insurance industry to a new level. The arrival of the epidemic has accelerated the online transformation of insurance companies. If there is any high investment in insurance companies at present, it must be investment in science and technology.

Xu Xian, director of the Department of Risk Management and Insurance at Fudan University, once pointed out that insurance technology has become an important driving force to help China’s high-quality economic development and the transformation of the insurance industry, and technology will further become an important weapon to reduce costs and improve efficiency in China’s insurance market. China’s insurance industry should better promote the new development pattern of the insurance industry with the help of this major historical opportunity and technology window.

As we all know, insurance companies have attached great importance to science and technology at the strategic level, and so has PICC China. It is reported that PICC China is "guided by strategy, customer-centered, problem-oriented, centralized and driven by innovation" to empower science and technology, and uses the new insurance logic of "underwriting+empowerment+impairment+claim settlement" to build technical barriers in the process of empowerment and impairment.

On the personal customer (To C) side.

The "People’s Insurance Company of China" App upgraded the service functions such as policy service, outlet reservation, gift package and driving service, optimized more than 50 service processes, and launched a series of user operation and promotion activities. In 2021, the monthly average number of active users was 1.853 million, a year-on-year increase of 39.5%, and the platform premium increased by 34.4%.

On the group customer (To B) side.

Complete the second phase of the corporate portal, build a social life service platform, support new business models such as "police-insurance linkage", enhance the service ability for corporate customers, and strengthen the stickiness of corporate customers.

On the employee (To E) side.

People’s Insurance e-Pass platform launched the functions of customer-specific birthday wishes, business opportunity screening, remote certificate uploading and bill signing, which enabled online sales, improved customer interaction temperature and visit success rate. The number of people who issued orders for the "People’s Insurance e-Pass" App was 1.833 million, an increase of 33.7% compared with the beginning of the year; The premium income was 42.88 billion yuan, a year-on-year increase of 33.3%.

In terms of service impairment

The driving and safety platform continued to empower the main business to reduce losses and realize a transaction volume of 2.13 billion yuan, a year-on-year increase of 91%; The amount of impairment was 940 million yuan, a year-on-year increase of 71%.

China PICC is empowering customers with scientific and technological means to solve the common problems in the industry, such as difficult and slow claims. It is worth mentioning that China PICC has launched the functions of "Thumb Claim" and "Video Claim", and users can obtain one-stop claim service from reporting an accident to collecting compensation through the thumb claim function and three simple actions of "one-click report, three photos and confirmation of account number"; The video claim function helps car owners to independently complete the process services such as auto insurance reporting, survey and damage determination on the spot by providing online "face-to-face" and "one-to-one" claim services with surveyors, without waiting for the surveyors to arrive at the scene, thus shortening the waiting time.

This is the best embodiment of technology empowering front-line business. Of course, science and technology can do more than that. China PICC is insisting on science and technology as the basic productivity and core competitiveness of PICC’s development, strengthening the front-line strength of science and technology empowerment, focusing on system and process improvement, and solving the pain points at the grassroots level.

Central enterprises take responsibility

Assemble the first line of emergency rescue and disaster relief

Stride forward, but Do not forget your initiative mind.

In the pursuit of business performance, PICC China has never lost its commitment to social responsibility, which is the historical mission of being the "eldest son of the Republic" and the inner persistence of PICC China in its efforts to move forward. It is understood that PICC China adheres to the mission of "People’s Insurance Serving the People", adheres to the needs of the country and the aspirations of PICC, and is more deeply integrated into the national strategy, the real economy and the people’s livelihood. In 2020 alone, the total amount of risk protection provided will reach 1,446 trillion yuan, and the total amount of insurance compensation will be 292.7 billion yuan.

On July 20th, many places in Henan Province were hit by torrential rain. PICC China started the first-level response of catastrophe claims, set up the Disaster emergency headquarters, and made every effort to fight floods, rescue and provide disaster relief. The Group continued to coordinate internal and external resources to rush to Henan, and concentrated its manpower, material resources and financial resources to do a good job in disaster relief and claim settlement: on the one hand, it opened a 24-hour service hotline and a green rescue channel for the "July 20" flood, providing free rescue regardless of whether it was a PICC customer or not; Launch the "three exemptions and always" service, further simplify the claim settlement procedures and maximize the convenience of the affected people; On the other hand, it quickly mobilized the elite claims force of nearly 10 provincial and municipal branches around Henan to support Henan’s rescue and disaster relief, and contributed warmth and strength to the whole society’s rapid victory over the disaster.

As of 17: 00 on July 25th, China PICC has received 207,000 reports of the rainstorm in Henan, and it is preliminarily estimated that the insurance economic compensation paid to policyholders will reach more than 2 billion yuan. At present, more than 50 million yuan of insurance compensation has been paid, and some compensation has been paid in advance. In addition, China People’s Insurance Group also announced that it will donate 30 million yuan to Henan Province through the People’s Insurance Fund of China to support flood relief and post-disaster reconstruction in Henan.

In order to cope with the typhoon "fireworks", all departments of PICC China are ready and actively deploy various pre-disaster preparations. People’s Insurance Company of Zhejiang invested more than 4,400 people in disaster prevention, dispatched more than 1,500 survey vehicles, organized more than 800 rescue vehicles, visited more than 4,500 enterprises on the spot, issued more than 4,100 loss prevention proposals, and placed disaster prevention warnings in more than 800 low-lying, bridge and culvert tunnels and underground garages.

On the previous road to poverty alleviation, China People’s Insurance Company must have been there. It is understood that PICC China has continuously promoted the "insurance+"poverty alleviation model to expand the scope and increase efficiency, helping to overcome the fortress of poverty alleviation. In recent years, it has undertaken poverty alleviation tasks at more than 880 help points (counties, townships and villages), invested more than 310 million yuan in help funds and materials, and spent more than 150 million yuan to help the poor, and sent more than 2,050 people to help the poor. From 2015 to 2020, the risk coverage for 610 million households was nearly 11 trillion yuan, and the average number of people served by major illness insurance exceeded 470 million each year; We will help the four designated poverty alleviation counties to get rid of poverty in an all-round way, all solve the problem of "two worries and three guarantees", complete the promised tasks with high quality, and better fulfill the responsibility of the financial enterprises in charge.

Behind the heavy data are the efforts and efforts of every "guarantor" and the responsibility of this "eldest son of the Republic".

Conclusion

The development of the insurance industry has never been easy. Every step of an insurance company should be "stable" and "fast". What is certain is that the broad development space of the insurance industry is still very large, which is very worth exploring and developing; In the industry transformation, the market should also give insurance companies more confidence and support.

From the perspective of PICC China, despite the recent impact of social security reduction, Henan rainstorm disaster and typhoon "Fireworks", the big fundamentals will continue to be consolidated with the implementation of the "excellent insurance strategy", with stable operating performance and enhanced profitability, which may be the "answer sheet" delivered by PICC China to shareholders.

End

This article first appeared on WeChat WeChat official account: A Wisdom Bao. The content of the article belongs to the author’s personal opinion and does not represent Hexun.com’s position. Investors should operate accordingly, at their own risk.