Insurance, Fintech & EM-focused Analyst, KT Capital Group, KT Capital Group

Alec Tseung

Insurance, Fintech & EM-focused Analyst, KT Capital Group

Thematic (Sector/Industry)

This Original aims to showcase the leading Insurtech companies in the three insurance markets with the highest growth potential in Asia - China, India, and Southeast Asia.Insurtech companies can be broadly divided into three categories - full-stack Inustech, Insurtech marketplace, and Insurtech enablers. As such, the Original also presents the Insurtech companies based on these categories by showing their company overview, how they leverage tech to do things differently, their product offerings, and financial information (capital raise and valuation in case of no financial information).The Insurtech companies presented are:<ul><li>Full-stack Insurtech: ZhongAn Online (China), Acko (India), SingLife (Singapore)</li><li>Insurtech marketplace: Waterdrop (China), Huize (China), Policybazaar (India), Coverfox (India), Turtlemint (India), PasarPolis (Indonesia), PolicyStreet (Malaysia)</li><li>Insurtech enablers: eBaoTech (China), Turtlemint (India), CXA Group (Singapore)  </li></ul>By analyzing the key Insurtech companies and their development in these countries/regions, we have further identified the following key trends/themes in the sector:<ul><li>In the near future, Insurtech is unlikely a threat to traditional (re)insurers who have also been actively investing in Insurtech themselves.</li><li>Insurtech marketplace is expanding offline and will likely embrace a hybrid model, especially in less developed insurance markets.</li><li>L&amp;H full-stack Insurtech companies are yet to be common in less developed insurance markets.</li><li>Insurtech is going to promote differentiated growth in insurance markets of different maturity.</li><li>“ReInsurtech” is currently still a blind spot.</li></ul><h2>What is Original?</h2>A deep dive into 12 (mostly private) leading Insurtech companies, under each Insurtech category from China, India, and Southeast Asia, is presented in this Original. Key investment thesis and risks are also developed for each company.  Based on the company analysis and the broader insurance and Insurtech development in these countries/regions, five key Insurtech trends and themes are further identified.

This Original aims to showcase the leading Insurtech companies in the three insurance markets with the highest growth potential in Asia - China, India, and Southeast Asia.Insurtech companies can be broadly divided into three categories - full-stack Inustech, Insurtech marketplace, and Insurtech enablers. As such, the Original also presents the Insurtech companies based on these categories by showing their company overview, how they leverage tech to do things differently, their product offerings, and financial information (capital raise and valuation in case of no financial information).The Insurtech companies presented are:Full-stack Insurtech: ZhongAn Online (China), Acko (India), SingLife (Singapore)Insurtech marketplace: Waterdrop (China), Huize (China), Policybazaar (India), Coverfox (India), Turtlemint (India), PasarPolis (Indonesia), PolicyStreet (Malaysia)Insurtech enablers: eBaoTech (China), Turtlemint (India), CXA Group (Singapore)  By analyzing the key Insurtech companies and their development in these countries/regions, we have further identified the following key trends/themes in the sector:In the near future, Insurtech is unlikely a threat to traditional (re)insurers who have also been actively investing in Insurtech themselves.Insurtech marketplace is expanding offline and will likely embrace a hybrid model, especially in less developed insurance markets.L&amp;H full-stack Insurtech companies are yet to be common in less developed insurance markets.Insurtech is going to promote differentiated growth in insurance markets of different maturity.“ReInsurtech” is currently still a blind spot.What is Original?A deep dive into 12 (mostly private) leading Insurtech companies, under each Insurtech category from China, India, and Southeast Asia, is presented in this Original. Key investment thesis and risks are also developed for each company.  Based on the company analysis and the broader insurance and Insurtech development in these countries/regions, five key Insurtech trends and themes are further identified. 

Asian Insurtech: The New Golden Child in Town?

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Capital Markets

<ul>
<li>The business model of QingSong is a platform offering comprehensive healthcare services and tailored financial resources. By connecting different stakeholders, QingSong can monetize its user base, creating a virtuous cycle.</li>
<li>Qingsong’s revenue structure has undergone significant changes. However, if Qingsong's future business focus is on Qingsong Healthcare services, it may be difficult to generate large-scale profits in the end.</li>
<li>Listed insurance intermediary platforms have been in the shadow of a decline in stock prices. So, there is concerns that future share price performance of QingSong may not be optimistic.  </li>
</ul>


The business model of QingSong is a platform offering comprehensive healthcare services and tailored financial resources. By connecting different stakeholders, QingSong can monetize its user base, creating a virtuous cycle.
Qingsong’s revenue structure has undergone significant changes. However, if Qingsong's future business focus is on Qingsong Healthcare services, it may be difficult to generate large-scale profits in the end.
Listed insurance intermediary platforms have been in the shadow of a decline in stock prices. So, there is concerns that future share price performance of QingSong may not be optimistic.  


QingSong Health Corporation - Pain Points of the Business Model and the Outlook

<ul>
<li>The essence of Shouhui's business model is to "sell insurance" rather than provide services with technological attributes. So, Shouhui has relatively single business composition and lacks diversified sources of revenue.</li>
<li>The trend of "disintermediation" is becoming increasingly evident, which may lead to customers deciding to purchase insurance directly from insurance companies not from Shouhui, resulting declining demand for Shouhui’s services/products.</li>
<li>The business nature of insurance is incompatible with the Internet's pursuit of rapid expansion. Cooling "Internet +insurance" investment in recent years proves the decline of market's enthusiasm for this business.</li>
</ul>


The essence of Shouhui's business model is to "sell insurance" rather than provide services with technological attributes. So, Shouhui has relatively single business composition and lacks diversified sources of revenue.
The trend of "disintermediation" is becoming increasingly evident, which may lead to customers deciding to purchase insurance directly from insurance companies not from Shouhui, resulting declining demand for Shouhui’s services/products.
The business nature of insurance is incompatible with the Internet's pursuit of rapid expansion. Cooling "Internet +insurance" investment in recent years proves the decline of market's enthusiasm for this business.


Pre-IPO Shouhui Tech - The Business Outlook and Stock Price Performance Are Not Optimistic

KT Capital Group

Principal investments and advisory firm that focuses on connecting the CIS countries with East Asia.

Principal investments and advisory firm

Equity Bottom-Up

<ul>
<li>Huize's further acceleration of the "online to offline integration strategy" likely pushes it to compete more directly against China's insurance giants (e.g., Ping An).</li>
<li>One key challenge smaller Chinese insurtech players face (when it comes to attracting investors) is that some of the country's insurance giants are relatively well digitized.</li>
<li>Ping An still represents a good way to gain exposure to China's broader insurance/insurtech space, especially given its current low valuation. </li>
</ul>


Huize's further acceleration of the "online to offline integration strategy" likely pushes it to compete more directly against China's insurance giants (e.g., Ping An).
One key challenge smaller Chinese insurtech players face (when it comes to attracting investors) is that some of the country's insurance giants are relatively well digitized.
Ping An still represents a good way to gain exposure to China's broader insurance/insurtech space, especially given its current low valuation. 


Huize: Getting More Difficult to Justify an Investment

Research from EqualOcean, EqualOcean

EqualOcean

Research from EqualOcean

EqualOcean is an investment research firm and information service provider focusing on China's Technology, Automotive and Consumer Internet sectors. With unique research and due diligence methodology, we provide tailored insights into a wide range of industries and companies, empowering our clients' value-added decisions.

Founded in 2014, EqualOcean is headquartered in Beijing and has offices in Shanghai, Shenzhen and New York.

<ul><li>Huize starts to show its forte – but loses steam</li><li>SelectQuote, an American 'twin' - Both operating online 'B2B2C' insurance intermediary businesses, Huize and SelectQuote (SLQT:NYSE) share several similarities. </li><li>Bottom line - Currently, the P/S ratio for Huize is at the trough – only 0.36 as of the press time – far below its peers as well as the industry average. </li></ul>

Huize starts to show its forte – but loses steamSelectQuote, an American 'twin' - Both operating online 'B2B2C' insurance intermediary businesses, Huize and SelectQuote (SLQT:NYSE) share several similarities. Bottom line - Currently, the P/S ratio for Huize is at the trough – only 0.36 as of the press time – far below its peers as well as the industry average. 

Without Backing from the Tech Giants, Huize Bucks the Trend

China

Huize Holding Limited operates as an online insurance products and services platform in China. The Company focuses on life and health, property, and casualty insurance products. Huize Holding serves customers in China.

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Huize Holding Limited (HUIZ US)

Asian Insurtech: The New Golden Child in Town?

A deep dive into 12 Insurtech companies in China, India, and Southeast Asia is presented in this Original. The key Insurtech trends and themes in...

Alec Tseung

QingSong Health Corporation - Pain Points of the Business Model and the Outlook

By connecting different stakeholders, QingSong can monetize user base. As revenue structure has undergone big changes, it may be hard to generate...

Xinyao (Criss) Wang

Pre-IPO Shouhui Tech - The Business Outlook and Stock Price Performance Are Not Optimistic

As Internet giants with greater brand recognition/resources have made online insurance intermediary market a "red sea", Shouhui's outlook is full...

Xinyao (Criss) Wang

Huize: Getting More Difficult to Justify an Investment

Ping An's low valuation has made it difficult to justify an investment in Huize and other smaller insurtech players in China.

Alec Tseung

Without Backing from the Tech Giants, Huize Bucks the Trend

We've all heard terms like traditional insurance companies and third-party insurance agents – but there may be less awareness about insurance...

EqualOcean

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