Anbang Group taken over by Chinese government.
The collapse of one of the largest insurance groups worldwide
As of February 2018, one of the biggest players in China’s financial markets, Anbang, hit the headlines when it was announced that it was to be taken over by the Chinese government.
With its ex-chairman recently going on trial for fraud and months of scrutiny from the Chinese government, it was not a complete surprise, but a move that was sudden.
How does this happen to such a big player in the insurance industry?
Anbang is one of the biggest providers of international insurance in the world, yet its business model differs to others. By providing ‘universal insurance,’ Anbang promises guaranteed pay-outs rather than pay-outs for risk events such as illness and death. This means that their margins (the difference between premiums paid and pay-outs) are low.
So how does a company of this size get big enough to buy ‘trophy’ properties, such as the Waldorf Astoria?
Investment returns, not policy sales.
Whilst Anbang are cited as one of the biggest insurance providers in the world, it is also volatile, with questionable handlings, poorly regulated, and has the ability for the government to step in and take over, or to close businesses completely. Anbang isn’t the first company that this has happened to either.
Here in the UK we have a strong economy with strict financial laws oriented to capitalism and finance globalization. This ensures that we can provide finance and insurance products you can trust.
For more information on how HealthCare International can help your personal or business insurance, please do not hesitate to contact us today.