Apr. 17 (NBD) -- Beijing Jingdong 360 Degree E-Commerce Co., Ltd, also known as JD.com Inc (JD.com), will invest about 536.6 million yuan (85.4 million U.S. dollars) for a 33 percent stake in the China unit of global insurance giant Allianz SE as part of the Chinese e-commerce firm's push into the online finance market, according to Allianz China General Insurance Company Ltd.'s information disclosure announcement posted on the website of the Insurance Association of China.

The investment came as other Chinese tech firms like its top rival Alibaba, Tencent, and Baidu have been investing heavily in the country's burgeoning online finance sector in recent years.

Founded in 2003, Allianz China offers a wide range of insurance services including auto, property, liability, marine, engineering, and domestic credit insurance, as well as short-term health insurance and accident insurance for individual and corporate clients, according to its website.

Allianz China disclosed on Monday that its registered capital will be raised from 805 million yuan (128.2 million U.S. dollars) to 1.6 billion yuan (254.9 million U.S. dollars) due to the introduction of three new investors.

Besides JD.com, a Shenzhen-based consultancy firm and China Sinda Intellectual Property have agreed to invest in the insurance company, taking a 4.27 percent and 12.4 percent stake in Allianz China, respectively. At the same time, Allianz SE's stake in Allianz China will be reduced to 50 percent from 100 percent.

The investment will make JD.com the second-largest shareholder of Allianz China and turn Allianz China into a joint venture. But the investment is still subject to approval from the China Banking Regulatory Commission, Allianz China said in the filing.

An insider of Allianz SE told NBD that the company has entered into a long-term partnership with JD.com to put in place a digital insurance joint venture in China. They will complement each other and come up with attractive insurance solutions so as to meet the fast-changing demand of Chinese consumers.

This is also a landmark for Allianz SE in its push into the Chinese market, the person added.

It's learned that JD.com has expanded into the insurance sector already. The company's financial arm JD Finance is acting as an insurance brokerage. Based on its powerful technologies, JD Finance is offering precise marketing, risk-based pricing, and anti-fraud services to insurance companies.

Zhu Junsheng, professor of Research Institute of Finance, Development Research Center of the State Council, said to NBD that foreign insurance firms, especially property insurance ones, only take a very limited market share in China, hampering their business expansion. Joining hands with internet companies like JD.com enables insurers to explore new operating models, such as leveraging digital technologies to empower all links along the industry's value chain, thereby improving overall efficiency.

 

Email: tanyuhan@nbd.com.cn

Editor: Tan Yuhan