Shanghai Finance

Coverage

Shanghai Insurance Exchange launched to facilitate trade of insurance and its derivatives

June 15,2016

   
   

Shanghai officially launched the long-awaited insurance exchange today at the two-day Lujiazui Forum, a step toward the city’s ambition to become an international insurance center.

With an initial registered capital of 2.24 billion yuan (US$341 million) contributed by 91 companies, the exchange will facilitate trading of insurance and insurance derivatives, with a focus on international reinsurance, shipping insurance, mega insurance deal bidding and special risk insurance.

The insurance exchange, the first of its kind in China, adds to an array of existing exchanges that trade stocks, bonds, commodities, and currencies in Shanghai.
 
“The new bourse will further diversify Shanghai financial markets’ function while promote the gathering of international insurers and reinsurers in the city and boost Shanghai’s voice in the global insurance industry,” Shanghai Executive Vice Mayor Tu Guangshao said at the launch ceremony.

First mooted in 2010, the exchange is tasked to align local businesses to global insurance practices and channel risk to be diversified outside of the insurance market via abundance of capacity in the capital markets.

“it’s an important step to promote the upgrading of China’s insurance industry,” said Chen Wenhui, vice chairman of China Insurance Regulatory Commission, “ The new exchange should play an active role in increasing supply of insurance products to meet increasingly diversified market demand and boost the coverage of insurance services.”
 
The exchange is expected to collaborate with China’s 300-billion-yuan national insurance investment fund to spearhead the country’s infrastructure development and meet Shanghai’s goal of becoming an international insurance centre by 2020.