International Marketing

China

International Marketing Assignment – The China Factor

Health Insurance

Amit Mani Tripathi, Roll nu 11 Shivam Mishra, Roll nu 10 Nitish Narayan, Roll

Where does china rank in terms of size?
1st 3rd

2nd

4th

5th

19.18% of world population

?

Ancient Chinese civilization flourished in the fertile basin of the Yellow River in the North China Plain. Earliest dynasty - Xia dynasty of the Yellow River basin (approx. 2000 BC) In 221 BC, the Qin Dynasty first conquered several states to form a Chinese empire The Republic of China, founded in 1911 after the overthrow of the Qing dynasty In the 1946–1949 phase of the Chinese Civil War, the Chinese Communist Party defeated the nationalist Kuomintang in mainland China and established the People's Republic of China in Beijing on 1 October 1949 In 1945, the ROC acquired Taiwan from Japan following World War II The Kuomintang relocated the ROC government to Taiwan

History...

?

?

?

?

?

Sneak peak
?Chinese

proclaim themselves "Lung Tik Chuan Ren" which translates to ‘descendants of the ‘ dragon is regarded as the symbol of the Chinese

?The ?It's

easy to tell the difference between Chinese, Korean and Japanese dragons. Just count the dragon's toes.
? Chinese dragons have five toes ? Korean dragons have four toes ? Japanese dragons have three toes

Enter the Dragon…

Sneak Peak
?China

surpassed the United States as the world's largest automobile market in 2009 car sales in China may rise as high as 40 million by 2020

Car Nation…

?Annual

?Side-effect

of the rapid growth of road

network
? a significant rise in traffic accidents – in 2011, 62 thousand accident deaths ? Pollution

opportunities

Sneak Peak
? China

will add 400 million people to its urban population by 2025 rate increased from 17.4% to 46.8% between 1978 and 2009 150 and 200 million migrant workers returning home to the countryside periodically with their earnings

? Urbanization

? Between

Urbanization

opportunities

Trivial Crucial Facts
?When ?There

you write your name in China you put your family name first then your first name. are about 42,000 characters in Chinese language.  An adult is only expected to know 5,000 of them. For example, ????????? means ‘American marriages are made in china’ of Chinese adults still live with their parents. 200 million people in China live on less than $1 a day.

?30%

?Approximately

Trivial Crucial Facts
?China ?China

is the source of 68% of the worlds "pirated" goods. produces 66% of the world's garlic, 15 billion pounds in 2009. Next are South Korea 6%, India 5%, and the USA 2.5%.

Social Environment
?Population ?Population ?Literacy ?Life
– –

: 1.34 Billion below poverty line: 2%

Rate : 90.92%

Expectancy : 71.44 yrs

Male: 69.71 yrs Female : 73.26 yrs



Social Environment (contd.)
?Labor

Force : 812.7 million
Labor force distribution

services; 33% agriculture; 40%

industry; 27%

Social Environment(contd.)
?Official ?Other

Language : Mandarin

Major Languages : Wu, Yue (incl. Cantonese), Min , Xiang, Gan and Haka Religions : Buddhism, Taoism, Chinese Folk Religion sporting culture. Basketball gaining popularity amongst Youth.

?Major

?Strong

Legal Environment
?Under

the World Trade Organization (WTO) framework, the Chinese government lowered entry barriers to foreign insurers, allowing them to establish joint-venture insurance firms in China of 2007, China had 100 insurance companies, 59 of which are domestic-funded and the rest 41 are foreign-funded. may consult the People’s Republic of China’s embassies or consultants stationed in their respective countries or regions. Alternatively, they can contact the local governments’ Department of Promotion of International Trade - the department in charge of the promotion of foreign trade and foreign investment.

?As

? Investors

Legal Environment (contd.)
?Main

Foreign Investment Laws and Regulations  Law of Chinese-Foreign Equity Joint Ventures and its implementation regulations:
?   Law of Chinese-Foreign Contractual Joint Ventures and its implementation regulations ?   Law of Wholly-Owned Foreign Enterprise and its implementation regulations ?   Law of Foreign-invested enterprises, the income tax and its implementation regulations ?   Law on the Protection of Taiwan Compatriots’ Investment

Economic Environment
? GDP:-

$ 7.3 trillion (2012 est.)

? GDP

growth:- 9.5% (2011 est.) (CIA World fact book) : Yuan ($1 = 6.3 Yuan)

? Currency

? Per

Capita Disposable Income :- $3,243 (2012 est.)
Rate:- 6.1%

? Unemployment

? Inflation

rate:- 2.97% below poverty line 13.4% (2012 est.)

? Population

Economic Environment (contd.)
? Labor

force: 815.3 million (2010); agriculture 10.2%, industry 46.9%, services 43% (2010 est.). $1.581 trillion (2010 est.): machinery and equipment, plastics, optical and medical equipment, iron and steel. $1.327 trillion (2010 est.): machinery and equipment, oil and mineral fuels, plastics, optical and medical equipment, organic chemicals, iron and steel. 8th in FDI as per CIA World Fact book in 2010

? Exports:

? Imports:

? Ranked

Political Environment
?The

People's Republic of China, along with Vietnam, North Korea, Laos, and Cuba, is one of the five remaining official communist states in the world. country is ruled by the Communist Party of China : Hu Jintao : Wen Jiabao

?The

?President ?Premier

Political Environment (contd.)
? Government holds a strong power on the economy. ? Insurance business in China is supervised by the CIRC, under Insurance Law, ? Provisions on the Adminstration of Insurance Companies, and Law of on Anti-Money Laudering. ? Microinsurance policy backed up by the Chinese government, experimenting in areas including Sichuan Province.

Technology Environment
?

Internet users:-500 million (2011) Internet hosts: 15.251 million (2010). China Telecom alone serves 55 million broadband subscribers Tianhe-1A world’s fastest supercomputer developed in 2010. China has been pioneering the deployment of pebble bed nuclear reactors, which run cooler and safer than conventional nuclear reactors. In 2011, China unveiled a prototype train capable of reaching speeds of 310 mph (500 km/h), the first ultra-high-speed train developed solely by its domestic railway industry.

?

?

?

?

?

Technological Environment (contd.)
? In

September 2011, the first Chinese space station module, Tiangong-1, was successfully launched, marking the first step in a decade-long project to construct a large manned space station. its first attempt at the robotic exploration of Mars in November 2011. conducted a successful test of an anti-satellite missile. missile, a new submarine-launched nuclear ICBM with multiple-warhead delivery capabilities.

? made

? China

? JL-2

Member at WTO
The World Trade Organization (WTO), like many clubs, denies patrons the right of automatic readmission. Having quit the organization's predecessor shortly after the Communist revolution of 1949, China had to wait 15 long years to gain entry after reapplying in the 1980s. The doors finally opened on December 11th 2001. The price of re-entry was as steep as the wait was long. China had to relax over 7,000 tariffs, quotas and other trade barriers.

Healthcare Development in China
80 67.9 60 57 68.6 71.4 73

40

35

20

0

1949

1957

1981

1990

2000

2005

Life expectancy at birth increased from 35y in mid-1950s to 73y in 2005!

Healthcare Development in China
1949 to 1960s Gradually established a health system in line with the national situation at that time Hardly any progress made except for in rural areas

1960s to late1970s

Late 1970s to mid1990s Mid1990s up to now

Reform exploring and progressing Further reforms have been being carried out

Grey Areas
Health insurance system:
? Some ? Lack

part of the population was still not covered by the health insurance systems; of integration of different health insurance systems, especially challenges from the mobility of the population; of assurance and government investment are still relatively low; enhanced; capacity needs to be further

? Level

? Management ? Reform

is desirable in the mode of payment.

Key Reforms Required for Improving Healthcare Insurance
?

To cover basic medical insurance system in an all-round way, and ensure the participation rate of basic medical insurance scheme for urban and rural residents to reach 90% or higher.
– – –

Basic Medical Insurance System for Urban Employees Basic Medical Insurance System for Urban Residents

?

New Rural Cooperative Medical Care Scheme To raise the percentage of medical costs for hospitalization in insurance, and incorporate outpatient fees of common diseases and frequent diseases into medicare reimbursement. To resolve the insurance for university students, people employed flexibly, retirees from bankrupt state-owned enterprises, retirees and workers of ill-functioning companies, and farmer-turned workers. To appropriately address medical insurance for migrant population. To improve the urban and rural medical relief system.

?

? ?

China Regulator: To Open Insurance Market More To Foreign Firms:
Wu Dingfu, chairman of the China Insurance Regulatory Commission

?The

head of China's insurance regulator said China will further open its markets to foreign competition, apparently addressing rising complaints among foreign financial institutions about their shrinking shares in China's domestic market. insurance market will become one of the world's most important markets in the coming years, and provide huge development potential for foreign insurers,” said he expects China's insurance market, which is now the world's sixth-largest insurance markets by premiums, to keep high growth rates in anticipation of a robust economy in the coming years. will further open its insurance market to foreign companies, and let foreign insurers play a bigger role in the local market," Wu said, without elaborating.

?"China's ?Wu

?"China

Product: Health Insurance
?Key

Benefits coverage for your family with floater benefit to structure the premium as per individuals requirement lifelong renewability

?Comprehensive ?Flexibility ?Entry

age no bar- Minimum entry age 3 months of choosing 1 or 2 year policy period as per plans offered claims facility at over 4,000+ network hospitals across China

?Guaranteed ?Option ?No

medical tests for insurance cover below 35 years age

?Cashless ?Continue ?No

to enjoy quality service even during claim settlements with our own in-house health claim processing and wellness team health check-up up to the age of 45 years (age as on last birthday) benefits under China Income Tax Act 1961 Sum Insured for every claim free year for one or two year covers (auto renewal) available

?Avail tax ?Options

?Get additional ?EMI

facility is available.

?Keep

your family secured even against expenses for hospitalization due to Natural Calamities.

Emotional Benefits:
?

Sight: Our Offices will be attractive, modern and well architected. Special waiting rooms, comfortable chairs for customers and employee. (good looking agents) Sound: In customer waiting room we will play soothing and relaxing music. Smell: Use of room fresheners in all the offices Skin: hygienic environment and comfortable chairs. Simplicity: Offices and agents will be customer friendly. The handouts and broachers will be deigned with utmost simplicity. Snap Value: Acting in accordance with our beliefs and values, Complete protection, immediate response during any complains. Taste: N\A

?

? ? ?

?

?

Apex Body Approval
The China Insurance Regulatory Commission (the "CIRC"), established on November 18, 1998
?Formulate ?Scrutinize ?Examine ?Pricing

policies for developing the insurance industry

and approval of insurance companies, subsidiaries, insurance holding companies and approve the qualifications of managers of various insurance companies regulation, insurance schemes the financial health of insurance companies policy-oriented insurance and compulsory insurance fair competition in industry insurance companies with overseas operations

?Supervise ?Supervise ?Supervise ?Supervise ?Create ?To

framework for insurance industry for information, risk, forecast, supervision. undertake other jobs delegated by the State Council

Understanding Chinese Regulatory Strategy : A Key First Step in Approaching the Market
?

The regulatory framework for the insurance sector was codified in the "Insurance Law of China," promulgated in 1995. Nonlife insurance approval is required to establish a representative office in China. The Chinese policy regarding life insurance has been to require foreign life insurance companies to form joint ventures with domestic companies with limit foreign equity share to 50 percent Management control must also be shared. Health insurance, foreign life companies (JVs) may be established only in "open" cities (currently Shanghai and Shenzhen).

?

?

? ?

Third Party Inspection

Pricing:
?

The Chinese market for most products, including insurance, is highly price sensitive. Product pricing is subject to approval by CIRC. Companies are allowed to set prices within a limited range. Currency Sensitivity: Chinese Yuan (RMB)will be the trading currency Forex Rate: 1 Chinese Yuan = 8.7138 Indian rupees Philosophy : Cost + Fair Play

? ? ?

? ?

We have four international Medical Insurance plans

Place:
? Corporate ? Tie

HQ and Insurance Office at Queen Mary’s Hospital Campus in Hong Kong.

up with Bethune International Peace Hospital and Peking Union Medical College and Hospital at Beijing by setting up information kiosks and Sales office. Office at Renji and Xinhua Hospital at Shanghai with suitably trained personnel to assist Clients with their queries regarding the Insurance. with Australia and New Zealand Banking Group Limited (ANZ) at Dongcheng & Industrial Commercial Bank of China (ICBC) at Xicheng District to gain access to customers from Rural Areas. Toll Free Number that operates 24*5 for any clarifications regarding payment / Renewal & Cancellation. highly interactive and updated Web Interface customizable to both English, Mandarin and Cantonese which automates the entire policy purchase process, with suitable payment options.

? Nodal

? Partnership

? A

? A

Promotion:
?Target

Prospects, Customer, End User

?Opinion

Makers: Private Companies Banks

?Testimony

Creators: Prestigious Users (Use of CRM) Celebrity endorsement(Common Public)

Promotion Medium:
?Bancassurance ?Direct

:

50% 10% 5% 2% 20% 10%

Sales: Agent(Tied):

?Telemarketing: ?Insurance

?Independent ?Brokers: ?Internet:

Financial Advisor: 3%

Packaging:
?Free

health coupon coupon

?Discount ?Online

chat with doctor, dietician and Nutritionist e-consultation e-consultation with one follow up session facility Support

?Specialist ?EMI

?24*7

People

People (contd.)
?Government ?Choosing ?Following

only allows establishment of joint-venture insurance firms in China the right partner is of paramount importance. aspects need to be considered :

? Market Focus ? Target Market ? Business Stability ? Financial Security Soundness and Structure ? Does their process and practice fit with yours ? Technical Expertise ? What Knowledge do they have of you? ? What is their Partnership mentality? ? Legal validation

Policies
?The
– –

Sales and Distribution policies will center around the following objective
Increase agent productivity Improve recruitment of new agents and retention of existing agents Improve customer retention and customer profitability Enable cross-selling and up-selling of products Explore new products and alternate channels for sales growth



– –

Policies (contd.)
?After

Sales Service

? After sales service plays an important role in customer satisfaction and customer retention. It generates loyal customers ? Sales Professionals need to stay in touch with the customers even after the policy has been sold. ? Give them the necessary support whenever they need , wherever they need.

Policies (contd.)
? Opening up multiple communication channels for customer issue redressal ? It would be wise to adopt CRM

?

THANK YOU



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