(Yicai Global) May 12 -- China Northern Rare Earth (Group) High-Tech Co. plans to invest CNY250 million (USD36 million) to establish the first regional insurance company, Zeyuan Agriculture and Animal Husbandry Insurance Co., in Inner Mongolia in partnership with Inner Mongolia Financial Investment Group Co. and eight other companies operating in the region.
The joint venture will have a registered capital of CNY1.4 billion (USD203 million) and launch insurance policies for agriculture and animal husbandry, agriculture-related property, liability, short-term health and accident, credit and surety, said a company statement. China Northern Rare Earth has chipped in nearly 17.9 percent of the registered capital.
The rare-earth supplier said that Inner Mongolia, a major agricultural province in northern China, still did not have its own insurance companies, and the establishment of a locally-incorporated insurance institution is urgently needed for developing the regional insurance market. Positioned as an agricultural insurance establishment, the new company will be entitled to subsidies of up to 90 percent of premium revenues offered by the central and local governments, thus giving it a clear advantage in the underdeveloped market.