The realm of reinsurance has become a critical component in the landscape of global risk management, especially against the backdrop of faint optimism for economic recovery and an ever-complex interplay of natural disastersThe recent Shanghai International Reinsurance Conference of 2024, themed "Global Cooperation, Open Win-Win," explored various dimensions of the reinsurance market, addressing both its challenges and opportunitiesThe conference brought together key players such as China Reinsurance (Group) Corporation, the People's Insurance Company of China, and the Shanghai Insurance Exchange, signifying a collaborative effort to bolster the reinsurance sector in China.

A key takeaway from the event is the accelerated development of the Shanghai International Reinsurance CenterThe center's establishment is designed to foster a framework characterized by concentrated business activities, dynamic transactions, and refined regulationsThese elements aim to enhance the global competitiveness of China's reinsurance market, propelling it towards a higher quality of development while nurturing its participation in global risk governance.

Chairman of China Reinsurance, He Chunlei, underscored the inherently international characteristics of reinsurance, which plays a significant role in advancing high-level institutional financial opennessGiven recent strategic opportunities presented by the nation and the dynamism of the reinsurance center's development, there is a palpable level of confidence from the company in its capacity to lead the charge for the high-level openness of the Chinese insurance industry.

Echoing this sentiment, Deputy Director of the National Financial Supervision and Administration Bureau, Xiao Yuanqi, spoke on the rapid evolution of China’s insurance sector since the 18th National CongressHe highlighted the industry’s significant contributions to social welfare, disaster prevention, and support for the real economy

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However, challenges stemming from both internal and external factors remain, leading to a recognition that the foundation for high-quality development in the sector needs solidification.

The establishment of the Shanghai Reinsurance Operations Center marks a milestone as it stands as one of the first specialized professional entities in the centerWang Zhongyao, General Manager of China Re Property & Casualty, articulated a three-pronged strategy for accelerating operations following the center's approvalThe emphasis on unified registration to enhance data integration, steady business transactions to bolster trading centralization, and developing standardized processes illustrates the organization's plans to enrich the operational aspect of reinsurance trading.

Furthermore, the discourse on disaster insurance was particularly relevant in the conference, with historical examples emphasizing the importance of catastrophe insurance in risk dispersalThe substantial claims paid by the insurance industry during catastrophic events, such as the $60 billion in losses from Hurricane Ian and $35 billion from the Great East Japan Earthquake, have showcased the limitations of relying solely on catastrophe insuranceReinsurance emerges as a pivotal player in further diversifying risk and mitigating losses.

Recent events, especially the severe typhoon "Mangkhut" that impacted parts of China, highlighted the importance of a robust catastrophe insurance frameworkIn reaction to the disaster, the insurance sector has been proactive in issuing guidelines for handling claims related to typhoons, resulting in notable outcomes in both compensation and post-disaster recovery.

As part of its commitment to enhancing the catastrophe insurance framework, China Re has been significantly involved in the issuance of catastrophe bonds and the development of proprietary catastrophe modeling technologyThe launch of the Commercial Version 2.0 of China's flood disaster model at the conference exemplified this, as it utilizes advanced technology to accurately predict and assess flood-related insurance losses, a crucial innovation in the context of increased extreme weather events.

The impact of international collaboration cannot be understated, highlighted by the establishment of the "Belt and Road" reinsurance community in 2020, which serves to manage risks related to China's overseas investments

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Encompassing 23 member companies, this platform has successfully provided risk coverage amounting to nearly RMB 150 billion for various overseas projects while enhancing the reinsurance capabilities for green projects, including significant offshore wind farms.

China Re has leveraged its global footprint to support export companies by collaborating with policy insurance firms to mitigate trade credit and investment risks associated with international marketsAs of the end of Q3 2024, their initiatives have supported over 219,000 export businesses, showcasing the integral connection between domestic companies and the global economy.

Moreover, China Re's ambitious acquisition strategies, such as the purchase of the Bridge Group in the UK, have positioned the company to become a formidable player in global reinsuranceCurrently, they maintain active partnerships across various international platforms including London, Beijing, and Singapore, interacting with over 1,000 partners across 200 countriesThis strategic expansion has led to a robust growth trajectory in premium revenues involving overseas property reinsurance.

The Annual Meeting of the China Nuclear Insurance Community further emphasizes the cooperative ventures that China Re engages in, as it serves as the executing body for nuclear risk management in the regionTheir involvement in international nuclear power plant safety assessments has facilitated the transfer of advanced risk management techniques that are instrumental in enhancing the safety measures in China's nuclear infrastructure.

Moving forward, the overarching aim is to improve domestic insurance market quality by intensifying innovation locally while tapping into international expertise and advancementsFor instance, despite the global cybersecurity insurance market reaching a substantial USD 13 billion, China's cyber insurance remains in nascent stagesChina Re's introduction of cybersecurity policy frameworks, including comprehensive cyber insurance solutions, represents a critical step towards safeguarding businesses in a digital age.

In conclusion, the Shanghai International Reinsurance Conference illustrated an evolving landscape in the reinsurance market, characterized by robust collaboration, advanced technological integration, and a steadfast commitment to addressing emerging risks

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