The comprehensive transformation of auto insurance has been completed for two years, and the results of "price reduction, insurance increase and quality improvement" are obvious. In addition, the auto insurance market is ushering in strong entrants, and the pace of "risk involvement" of auto giants is accelerating. Recently, the State Administration of Market Regulation enterprise name registration announcement shows that it has approved the name declaration of "BMW (China) Insurance Broker Co., LTD.". This is another big car company to enter the auto insurance industry after NiO, BYD (002594), Tesla and other companies.

Industry insiders said that as the new energy vehicle market continues to grow, the new energy auto insurance brokerage business will be a breakthrough for the automobile industry and the insurance industry to unite and join hands in transformation. However, car companies will also face certain challenges in obtaining the necessary license for auto insurance business and building the offline service network system.

Car companies compete for car insurance cake

Since the comprehensive reform of auto insurance for two years, the effect of "price reduction, insurance increase and quality improvement" has appeared. Auto giants also frequently cut into the insurance track, competing for the "big cake" of auto insurance.

Recently, the State Administration of Market Regulation enterprise name registration announcement shows that it has approved the name declaration of "BMW (China) Insurance Broker Co., LTD.". In fact, there is a precedent for car companies to move into insurance. In 2011, SAIC Motor Group (600104) established Shanghai Automobile Group Insurance Sales Company, and GAC Motor Group (601238) jointly established Zhongcheng Automobile Insurance Co., LTD.

In recent years, the new forces of car making represented by "Wei Xiaoli" have continued to act. In the first half of this year, BYD Insurance Brokerage company and Weilai insurance brokerage Company were established; Tesla registered and established Tesla Insurance Brokerage Co., LTD in China in August 2020; Xopeng Automobile established Guangzhou Xopeng Automobile Insurance Agency Co., LTD in July 2018.

There are also some car companies through the acquisition of "curve entry". In the first half of this year, Ideal Automobile won the insurance brokerage license through the way of 100% holding of Yinjian Insurance Brokerage Co., LTD., by Car Hejia Financial Technology (Jiangsu) Co., LTD.

Unlike traditional car companies, new energy car companies mostly enter the insurance industry by setting up insurance brokerage companies. Industry insiders believe that this move or optimistic about the broad market of new energy vehicles. According to the China Automobile Association data, from January to August this year, the production and sales of new energy vehicles completed 3.97 million and 3.86 million, respectively, an increase of 1.2 times and 1.1 times, which has exceeded the production and sales of new energy vehicles in the whole year last year. In addition, in December last year, the China Insurance Industry Association issued the "New Energy Vehicle Commercial Insurance Exclusive Clauses (Trial)", requiring all new energy vehicles to be insured by new energy vehicle insurance.

Seek a breakthrough for the transformation

Industry insiders said that in the context of the growing new energy vehicle market, new energy vehicle companies choose to "risk" in order to unite with the insurance industry and seek a breakthrough in hand in transformation.

The relevant business personnel of an auto finance company said that new energy vehicles may set off a new wave of car companies to enter the insurance industry. Different from the traditional fuel vehicle distribution model, the whole chain of new energy vehicle enterprises is involved in many links such as production, sales and repair, and has detailed data in the front, middle and back end of new energy vehicles, and has advantages in risk data accumulation and premium formulation. "In terms of customer service, new energy vehicle companies understand the risk situation of individual customers and vehicles, and may launch more customized services in the future, and for large car companies, entering the insurance industry can effectively reduce insurance costs, while obtaining certain operating income, but also integrate the industrial chain and enrich the way of automobile after-sales service."

In addition, the profit from premiums is also one of the reasons why some car companies layout auto insurance business. Some analysts believe that due to the high risk rate and loss rate of new energy vehicles, coupled with the fast replacement of new energy vehicles, high maintenance costs, few professional maintenance personnel and other problems, in recent years, some insurance companies have increased the premium price of new energy vehicles after comprehensive assessment, and the profits brought by premiums have allowed car companies to see revenue growth.

The layout of automobile enterprises has advantages

According to relevant regulations, car companies operating insurance business need to obtain regulatory approval. Industry insiders pointed out that if such insurance brokerage companies want to carry out related businesses in the future, it is still subject to further review and approval by the regulatory authorities. However, the industry is optimistic about its prospects and believes that car companies have certain advantages in the new energy auto insurance market.

Ge Yuxiang, analyst of Shenwan Hongyuan Securities (000562), said that car companies have obvious advantages in the new energy auto insurance market, one is that new energy car companies can simplify the claims process of new energy vehicles, and the other is that car companies can design innovative auto insurance products that better match risk and claims. "The rise of the new energy vehicle direct operation model makes the car companies directly contact the buyers of new energy auto insurance, so as to directly obtain the information of the owners who buy new energy auto insurance." Ge Yuxiang said.

For the future development of car companies into the insurance industry, iResearch research report believes that car insurance is expected to become the entrance for car companies to serve owners. Specifically, car companies are expected to face the end consumers on the basis of direct sales model and automobile network connectivity, the future vehicle delivery is only the starting point for car companies to create value, and the subsequent car insurance as a service starting point, car companies can open up more after-car ecology, owner rights and other service systems.

However, some people in the industry believe that there are certain problems for car companies to obtain the necessary operating licenses for auto insurance business. In addition, in order to provide users with high-quality claims, maintenance, and owner services, car companies are required to cooperate with a large number of offline service outlets or build a huge service network system, which requires a lot of time and capital costs, once insufficient preparation may affect the user's service experience.