Central Bank governor Yi Gang pledged at the recent Boao Forum to widen China's financial market, especially the insurance sector. What impact will that have on China's insurance market? Yu Wen tells us more.

Insurance businesses in China generally fall into two categories -- life insurance and non-life insurance. Overseas shareholders have been permitted to hold over 51% of the non-life insurance companies since China joined the World Trade Organization in 2001. And two years after that, overseas non-life insurance firms were allowed to set up their own wholly-owned enterprises here. But it was a different story for life insurance companies.

Well, their time may have finally come. Foreign life insurance companies are expected to receive permission to hold up to 51% of shares in their counterpart companies before long, according to Yi Gang's statement. Summer Sheng, a partner at the Allbright law offices, says she expects local and foreign firms to begin combining their advantages.

SUMMER SHENG, PARTNER ALLBRIGHT LAW OFFICES "I think Chinese companies, have wider market coverage, while the foreign firms are better managed and have more attractive services. The market share of overseas-funded companies is still relatively small, probably because of their inadequate market coverage here. Therefore, they should really think about how to optimize their products and digitize their sales. I think mergers and acquisitions are likely, particularly with the existing Sino-foreign joint ventures, where they could pick up additional foreign shareholders."

STARR is a China-US joint non-life insurance company. The company used to be a state-owned insurance company but sold over 90% to its current US partner. The company says the deal has made it more competitive.

ZHANG XING, CEO STARR "We used to concentrate on the auto insurance business, which was 75% of the total when we were still state-owned. We shifted our footing to offering insurance for overseas Chinese projects, workers, and tourists after the Starr Insurance Group bought most of the shares in 2014. We can now provide services helping domestic companies to protect their overseas businesses."

The openings not only provide access to China for overseas insurance companies but to the overseas insurance brokers who can sell policies from these companies. They will likely be able to sell policies to individual customers as well.

SUMMER SHENG, PARTNER ALLBRIGHT LAW OFFICES "For now, overseas-funded insurance brokers can only take care of the insurance and reinsurance businesses in limited areas, such as big commercial events and international logistics. They are not allowed to provide services for small and medium-sized companies or for individual customers. So if those brokers can benefit from the opening-up policy, to enjoy the same rights as their Chinese counterparts, they will become yet another rising player in the market. They, however, will face the issue of how to grow their market here."

The total amount of national commercial insurance fees came to more than 30 billion yuan last year, up 24% from the figure in 2016. The amount for individual life insurance policies was even greater, 2.7 trillion yuan, up 20%. While the demand is obviously substantial, analysts caution the public to be prudent about new types of policies with which they may not be familiar coming into the market.