Ergo Versicherungsgruppe (EVG2), the primary-insurance unit of Munich Re (RUKN), said it will enter the Chinese life insurance market through a joint venture with a government-owned partner.
“The joint venture will primarily offer life insurance to private customers in the economically attractive province of Shandong,” Dusseldorf-based Ergo said in an e-mailed statement today. Ergo and Shandong State-owned Assets Investment Holding Co. agreed to form the joint venture in January 2011 and have now received regulatory approval.
Ergo, led by Chief Executive Officer Torsten Oletzky, is Germany’s second-biggest primary insurer after Allianz SE (ALV) and is fully owned by Munich Re, the world’s largest reinsurer. Ergo and the Chinese firm, which is part of the provincial government of Shandong’s asset manager, will each hold 50 percent of the venture and the headquarters will be located in Jinan, the capital of Shandong, Ergo said.
“By entering the Chinese insurance market, we are strengthening our position in the emerging Asian markets, which are a focal point of our international growth strategy,” Jochen Messemer, Ergo’s management board member in charge of international operations, said in the statement. “The Chinese insurance market has consistently developed at high growth rates in recent years and will continue to offer enormous potential for further growth.”
The Shandong province has a population of 96 million and is the third-largest domestic insurance market in China, Ergo said. The company expects to start operations there in the first half of 2013.
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