(Yicai Global) Feb. 26 -- A unit of leading Chinese carmaker Geely Automobile Holdings Ltd. has received the go-ahead from Chinese regulators to start operations of an insurance agency serving car owners.
Hangzhou-based YiBao Insurance Agency Co. is the first firm to receive an insurance broker license from China Insurance Regulatory Commission this year, and can sell products, collect premiums, conduct claim investigations and settlements, the CIRC said on its website.
Geely's securement of an insurance broker license through a subsidiary is a common practice among carmakers, with Guangzhou Automobile Group Co. adopting this strategy in the past. The application process is relatively simple, and allows firms to bundle car insurance and other value-added services with their own products.
The license still gives Geely a clear edge over competitors, considering that the CIRC has tightened its grip on the license application review process of late.
Geely set up YiBao Insurance in late 2015 with an initial registered capital of CNY50 million (USD7.8 million), and its legal representative is Pan Leifang.
Founded in 1986, Geely entered the automobile market in 1997, and its total assets currently stand at over CNY200 billion. The firm recently bought Kuwait Investment Authority's 9.7 percent stake in Mercedes-Benz parent Daimler AG for USD9 billion, becoming the auto giant's largest shareholder.