Prudential Financial and Chinese conglomerate Fosun Group have received approval from the China Insurance Regulatory Commission (CIRC) to launch a new life insurance joint venture company (JV) in China.
The yet to be launched company will be China’s only life insurance joint venture between a private enterprise and a foreign insurer.
The JV will start with registered capital of $78m with the Prudential Insurance Company of America (PICA), the US insurance arm of Prudential Financial, and Fosun each contributing 50% of it.
Based in Shanghai, the new JV is expected to begin operations in the fourth quarter of 2012, following receipt of final approval by CIRC and other regulatory authorities.
According to CIRC, life insurance premium (including health and personal accident insurance) amounted to RMB1.06 trillion in 2010.
With approximately $883bn of assets under management as of 30 June 2011, Prudential has operations in the US, Asia, Europe, and Latin America.
According to Mark Grier, vice-chairman of PFI and Guo Guangchang, president of Fosun, the first priority of the joint venture will be to establish a management team and to begin building the company. Kenny Wu will head the JV’s preparation team and senior management team will be jointly selected by PFI and Fosun.