SHANGHAI, Nov 19 (Reuters) - Foreign life insurers' market share in Shanghai, China's commercial hub and a key market, declined for a third month in a row in October as troubles at overseas firms such as AIG dented consumer confidence.
Analysts also blamed the lower market share, which has almost halved from a year earlier, on China's slumping stock markets, which reduced consumers' appetite for investment-linked products offered by foreign firms, and on new restrictions on insurers selling policies through bank outlets."Foreign insurers used to woo Chinese customers with their overseas expertise and global networks," said Wang Xiaogang, analyst at Orient Securities Co. "No doubt, the global crisis is now hurting their appeal in China."Foreign insurers' share of the Shanghai market, which generated almost one-quarter of their premium income in China in the first nine months of the year, slumped to 17.08 percent in October from 31 percent a year ago, according to data from the Shanghai Insurance Association seen by Reuters.China's insurance regulator has yet to publish nationwide data for October.American International Group Inc (AIG.N), hit by the global credit crisis, is getting a $150 billion bailout from the U.S. government, while other U.S. and European insurers including Prudential Financial Inc (PRU.N), MetLife Inc (MET.N) and Allianz (ALVG.DE), have reported weak third-quarter results, hurt by losses on investments.PREMIUM INCOME FALLSAIG's troubles sparked a rush by hundreds of its customers to its Singapore office in September to redeem policies.Although such scenes were not witnessed in China and AIG has assured its Chinese customers that it has ample liquidity and is operating normally, there are signs its premium income is falling.AIG, the largest foreign insurer in China, saw its January-October premium income in Beijing drop 10 percent from a year earlier to 1.2 billion yuan ($175.6 million), while 450 million yuan worth of policies were redeemed, according to data obtained by Reuters.The company's Shanghai premium income fell 18.7 percent in October from a year earlier, while its foreign rivals, which have a much smaller market share, saw an even more drastic drop, with Allianz falling 79 percent and Metlife down 81 percent. Industry-wide premium income was up nearly 40 percent in Shanghai in October.Analysts said the overseas credit crisis was not the only factor working against foreign insurers, however."Investment-linked policies helped foreign insurers lure clients during the bull market, but have lost their attractiveness," said Zhang Li, analyst at Lianhe Securities Co.In recent months regulators have also restricted the sale of insurance policies through banks, a common distribution channel for foreign insurers that lack the big sales forces of their domestic rivals, over concerns that bank personnel may lack the expertise to sell insurance products, domestic media reported."Bancassurance also helped to boost foreign insurers' business, but regulators are now worried that the practice could mislead bank clients." Bu e-posta, Turkcell BlackBerry ile gönderilmiştir.
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