Econ 310 Sec 2 Group 4 Financial Institutions in Hong Kong Topic: Under the environment of the whole Hong Kong insurance industry, how Zurich can continue their business in Hong Kong? Ko Kwan Lam, Coco 033012 Pan Yi Lam, Helen 033015 Leung Wing Hang, Erica 033017 Siu Kit Yuk, Karen 033038 Ng Man Sum, Sam 033047 Mak Ho Kong, Reef 033068

Agenda Introduction …….….……………………….Reef CEPA…………...……………………….….Reef Opportunities………………………………..CoCo Threats……………………………………..Helen History of Zurich…………………………..…Sam Strengths of Zurich...........................................….Sam Weakness of Zurich……………………….....Erica Recommendation…..………………………..Karen Conclusion………….……………………….Erica

Introduction 033068 by Reef

Hong Kong Market Asian insurance market: fully mature, transitional and incipient. HK market: transitional the demand for insurance grows substantially faster than wealth. 033068 by Reef

CEPA 033068 by Reef

CEPA Closer Economic Partnership Arrangement covers 273 types of product and 26 services including insurance. 033068 by Reef

PRC Market situation and environment Gross domestic product Per Capita Disposable Income of Urban Residents Premiums of domestic and foreign insurance companies. 033068 by Reef

Gross domestic product 13,651.5 billion yuan, up by 9.5% over 2003 at comparable prices in 2004. 033068 by Reef

Per Capita Disposable Income of Urban Residents 7902 yuan in first three quarters of 2005, there is an increase of 11.7 % compared with the same period of 2004 The expenditure for family equipment & services and medical care & health increased 9.4% and 15.3% respectively Chance 033068 by Reef

Premiums of domestic and foreign insurance companies 431.8 billion yuan in 2004, increased 11.3% from 2003 China is a big market! 033068 by Reef

Recommendation Network for Hong Kong and China Enter the market in Shenzhen, Guangdong first, and then step-by-step move the direction to the North, Coverage of Zurich can be expanded from South to North. New strategy and plans in Zurich share information and set up the strategy together for future planning between HK and China branches 033068 by Reef

SWOT Analysis

Opportunities 033012 by CoCo

Opportunities entering China market stability new product reinsurance & captive insurance I.T. intermediaries 033012 by CoCo

Threat 033015 by Helen

Threat Difficult to open the market Competitors Highly fragmented and over-competitive Competitors Mutual funds, commercial banks, and other financial institutions 033015 by Helen

Threat Uncertain outlook Law regulation Business cycle a negative growth of gross premiums in general insurance business Law regulation not enough to protect the insurers Business cycle affect the premiums 033015 by Helen

History of Zurich 033047 by Sam

Zurich Insurance Group (Hong Kong) Member of Zurich Financial Service 130 years experience Over 30million customers in the world Presence in Hong Kong in 1961 Named ‘Eagle Star Insurance Group’ Merger with Zurich in 1998 Currently top 10 insurer in Hong Kong 033047 by Sam

Strengths 033047 by Sam

Strength of Zurich Great experiences Good rated 130 years Good rated rated “A+” by Standard & Poor’s rated A2 from Moody’s New products are provided periodically Eg. Zurich Whole Life Hospital Cash Insurance Plan 033047 by Sam

Strength of Zurich Professional staff Supporting in community using Sales Automation and Management System (SAM) to train their staff co-organized Executive MBA programme with the Lingnan University Supporting in community Can build up their brand name Eg. Zurich Business Administration Paper 2004 033047 by Sam

Weakness 033017 by Erica

Weakness of Zurich Financial strength not as high as the other competitors No 24-hour telephone hotline to ALL of its customers. 033017 by Erica

Weakness of Zurich Lack of experience compared to competitors Lack of plans  less choice For the General business market, the underwriting profit of Zurich decreased 62.88% 033017 by Erica

Recommendation 033038 by Karen

Recommendation Business cycle New plans for new market Pets insurance Short term plan Internship program for university student Training for staffs Better after sale service Education 033038 by Karen

Conclusion 033017 by Erica

Revision

Revision In which year, Zurich started its business with the name of ‘Eagle Star Insurance Group’? 1961 1982 1998

Revision 2. What level of insurance market is Hong Kong in? a. fully mature b. transitional c. incipient

Revision 3. Does Zurich have a bright future? a. Yes, it does. b. No, it does not.

End