AZCL says its premium income in the first five months of 2006 soared 550.7 per cent from the previous period, raising the company from 10th to 4th place in the ranking of China's foreign joint venture insurance companies.

As one of the first European life insurance companies to enter the mainland market, Allianz forged a joint venture in 1999 with domestic insurer Dazhong. But the partnership was dissolved earlier this year in favour of CITIC. Declining to go into detail about the split, Molt says: "We had different strategic priorities to our previous partner."

Industry sources speculate that Dazhong was unwilling to make the additional investment in capital and other resources required by AZCL to realize its business expansion goals.

New partner, CITIC "shares our strategy and interest in developing our presence in the insurance market" on the mainland, says Molt.

What's more, the name change has "underscored" the Allianz brand, says Molt. Now, all Allianz insurance products sold in China are branded like those in other markets.

In China, the company so far has penetrated the markets of 11 coastal cities, including Shanghai, Hangzhou, Ningbo, Shaoxing in Zhejiang Province, Guangzhou, Panyu, Zhongshan, Jiangmen, Nanhai, Dongguan and Shenzhen in Guangdong Province.

Molt says that the company is now targeting Chengdu, Sichuan Province, in its expansion plan. "Our plan calls for the exploration of markets as we move inland toward the west," he said.

Discovering new inland markets is important to AZCL as well as to other foreign joint venture insurance companies because the traditional markets are overwhelmingly dominated by domestic insurers, notably China Life, with premium income amounting to 91 billion yuan (US$11.4 billion) in the first five months of 2006.

"Allianz culture is to run our business locally," Molt says. The co-operation between AZCL and CITIC is a good example of the localized strategy, he added.

"We know the insurance business very well and they know the local market conditions."
Combining the best of international risk management expertise and local capital management, "we are in a good position to develop tailor-made life insurance products to meet the needs of Chinese clients," says Molt.

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