Baidu Inc.'s insurance brokerage arm will start issuing products in April, Jason Wang, director and head of strategy management at the tech giant's financial services group, told S&P Global Market Intelligence.
Baidu obtained an insurance broker license in China in September 2017 through the acquisition of a 100% stake in an existing insurance broker for 50 million yuan, according to China's National Enterprise Credit Information Publicity System.
"An insurance broker license doesn't only mean [Baidu can conduct] brokerage business," Wang told S&P Global Market Intelligence on the sidelines of the Asian Financial Forum in Hong Kong. "[The license] also includes functions of insurance product design and actuary."
Wang declined to comment on what types of products the insurance broker will offer and how it will compete with other tech giants' insurance business, including Tencent Holdings Ltd.'s WeSure Insurance Agency Co. Ltd., which started selling health insurance in Novermber 2017. Ant Financial Services Group, an affiliate of another Chinese tech giant, Alibaba Group Holding Ltd., also received approval from the China Insurance Regulatory Commission in September 2017 to open a Hangzhou-based insurance broker and sell auto insurance through its payment system Alipay.
Meanwhile, Baidu also plans to set up a property insurance joint venture with China Pacific Insurance (Group) Co. Ltd. and an online insurance joint venture with Allianz Group and Hillhouse Capital that will focus on travel, Internet finance and health insurance, among other areas. However, both insurance licenses have yet to be approved by the CIRC amid the regulator's heightened caution regarding the issuance of new insurance underwriter licenses.
As of Jan. 15, US$1 was equivalent to 6.44 Chinese yuan.