Four major courier firms in China are joining forces with two state-owned financial firms to set up an insurance company to cover their logistics operations.
In a press statement by courier STO Express, the firm said that it will establish an insurer alongside three other couriers and two state-owned firms – Jiangxi Financial Holding Group and Shandong Jingjin Holding Group.
Another private company, Guangzhou Baogong International Freight Agency, will also back the joint venture, according to a report by QQ.com’s news portal.
The insurer, tentatively named Zhongbang Logistics Insurance, will have a registered capital of RMB1 billion (US$151.7 million), the statement revealed.
The logistics and courier industries in China have boomed in recent years, driven by the increase in manufacturing and online shopping. However, the industry is exposed to many risks that are not covered by conventional insurance products.
According to the statement, the establishment of Zhongbang Logistics Insurance is a means to provide tailor-made insurance products which cover major logistics risks, including those for transportation, vehicles, property, liability, and accidents.
The insurer has yet to receive approval from the China Insurance Regulatory Commission, which is a prerequisite for it to operate.
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