Name
Global FinTech Guide
Country _ Name
China
SectionTitle
InsurTech
Body
InsurTech is composed of the words “insurance” and “technology”. It is used as a collective term for the application of modern technologies in the domain of insurance services.

Digital and mobile brokers: FinTechs belonging to this category mostly act as digital insurance brokers and provide users with an overview of their insurance contracts with their respective conditions. Some FinTechs offer very short-term insurance contracts to cover specific cases which can be concluded often spontaneously via mobile devices. Oftentimes additional consulting services are offered.

Internet of things: FinTechs belonging to this category collect data by measuring for example the driving style of the customers or through wearables the customers wear to consult on, offer and/or manage the customer’s insurances.

Introduction

Attitude of the country towards InsurTech-services

According to the 14th Five-Year Development Plan InsurTech issued by Insurance Association of China in December 2021 (14th Five-Year Plan), it is noticed that 'technology' is playing an increasingly important role in promoting the high-quality development of the insurance industry for the past few years. For the new five-year period, the authority emphasises its encouragement on Insurance Institutions to improve and upgrade online insurance services with InsurTech.

The Implementation Plan for the High-quality Development of Fintech in the Banking and Insurance Industries (the “Implementation Plan”) was jointly issued by NFRA, the Ministry of Science and Technology, and the National Development and Reform Commission in March 2025. It aims to implement the innovation-driven development strategy for the banking and insurance industries. The Implementation Plan includes a goal to enhance InsurTech Services, instructing insurance companies to focus on key areas such as technology research and development, technology transfer and application, and intellectual property protection. Tailored insurance products can be designed to address specific needs related to R&D losses, equipment damages, and patent protection, catering to various stages of technology-based enterprises and covering the entire process of the technological innovation. Legal affairs


Legal affairs

Obligations and requirements to provide InsurTech-services

In China, providing online insurance services to the customer is subject to the supervision of the insurance authority, the NFRA. On the other hand, business relevant to InsurTech-services could involve multiple types of operating entities, ranging from insurance company, insurance agency/brokerage company, and other vendors who provide auxiliary support.

Firstly, if an entity operates and develops an insurance business, including sales, underwriting, settlement of claims, surrender, complaints handling, and customer services, such entity shall obtain an insurance license issued by NFRA. Depending on the type of the insurance business, the entity shall obtain different insurance licenses with different fund requirements. For instance, the minimum paid-in registered capital of an insurance company shall be RMB200 million (equivalent to approximately USD27.7 million or EUR25.8 million), subject to specific business scope. The paid-in registered capital of a nationwide insurance agency/brokerage company shall be at least RMB50 million (equivalent to approximately USD6.92 million or EUR6.44 million). Upon obtaining the license, the entity shall further comply with a series of detailed requirements to carry out the internet insurance business, including but not limited to, the construction of the internet infrastructure (e.g. implement the multi-level protection system for cybersecurity and obtain corresponding certificate) and the insurance products design (e.g. design special products for online distribution) etc.

Secondly, if an entity will not engage in the above-mentioned insurance business, such entity is allowed to provide auxiliary services of Internet technical support for insurance consumers and insurance institutions. It should be noted that such InsurTech-services providers are usually technology companies undertaking the business in terms of big data, blockchain, software, artificial intelligence, cloud computing etc. Accordingly, tech companies need to apply for licenses or qualifications for business related to software and other technology required by specific market regulatory department. On the other hand, such entities are strictly prohibited from providing any insurance sales service, especially, comparing prices of different insurance products. In practice, making profits from providing consultation to insurance customers – e.g. assisting in insurance application, making insurance plans, will be deemed as providing insurance sales services rather than auxiliary services by NFRA. For example, the leading insurance technology company, Hangzhou Fansheng Technology, was imposed by CBIRC (already replaced by NFRA) in 2020 with a fine of RMB0.98 million (equivalent to approximately USD154 thousand or EUR139 thousand) for providing insurance agency/brokerage service without proper license due to the said consultation services through 'Duo Bao Yu' platform.

Additional comments regarding the legal situation for InsurTech-services or what InsurTech’s must be aware of in this business area

In China, insurance services, as an important financial services sector, are highly regulated. At present, only insurance companies, insurance broker companies, insurance agency companies and insurance surveyors and loss adjusters companies incorporated in China with the insurance license issued by NFRA are allowed to engage in internet insurance business as described above.
Although there is no foreign investment restriction on the insurance industry, the application for establishing a foreign-invested insurance institution will still be under strict review of NFRA and the foreign investors shall have experience in the insurance broker/agent area. The applicants may take years to obtain an insurance license.


Economic conditions

Market size for InsurTech-services and biggest companies in this business area

InsurTech-services market is a growing market. According to the 14th Five-Year Plan, from 2018 to 2020, the total investment in the InsurTech reached RMB94.185 billion (equivalent to approximately USD13.1 billion or EUR11.2 billion). For the year of 2020, the total investment in the InsurTech is RMB35.1 billion (equivalent to approximately USD4.9 billion or EUR4.1 billion), accounted for 0.63% of the operating income; the number of formal InsurTech staff is approximately 26,000, accounting for 2.51% of the total number of the insurance practitioners.

Further, considering that the InsurTech services are closely related to the insurance business that shall only be carried out by companies with a proper license, generally speaking, the big insurance companies will have their own InsurTech company to provide relevant services internally. It might be hard to identify the biggest InsurTech companies according to the market shares, while it is known that the technology companies within the big insurance group might be the largest ones, such as Ping An Technology (Shenzhen) Co., Ltd and China Life Ecommerce Co., Ltd.

On the other hand, the Internet-based insurance business is rapidly expanding. The "Measures for the Supervision of Internet Insurance Business" (the Internet Insurance Measures) took effect on February 1, 2021. These measures promote the integration of insurance with new technologies such as the Internet, big data, and blockchain, and encourage the use of technology to enhance the accuracy of risk identification and solutions in internet insurance businesses. When insurance institutions engage in internet insurance business, such operations should be centrally managed and uniformly administered by their headquarters. Simultaneously, a unified and centralized business platform, operational procedures, and management systems should be established. In August 2024, NFRA issued the the "Notice on Matters Concerning Strengthening and Improving Supervision of Internet Property Insurance Business" as a supporting regulatory document to the Internet Insurance Measures. This notice reinforces regulatory requirements and qualifications for conducting Internet property insurance business, focusing on comprehensive solvency capability, risk assessment, consumer protection, data security, and compliance measures etc..

Additional comments regarding the economic situation for InsurTech-services or what InsurTech’s must be aware of in this business area
In 2021, CBIRC (already replaced by NFRA) issued the Regulation on Management of Internet Insurance Business to specify the detailed rules for operation of online Insurance. Under these new rules, CBIRC (already replaced by NFRA) strengthens the requirements on the entry thresholds of market players. Another important aspect is that insurance institution conducting Internet insurance businesses and its self-run network platform shall comply with national graded protection system for cybersecurity, including filing of cybersecurity grading, regular assessment and implementation of security protection measures. Additionally, it should be clarified that the license holders are allowed to run the online insurance business in creative ways and the pure technology companies are limited to participate in the business through technology supporting line, rather than insurance-related business.



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