BYD set up its own auto insurance business through an acquisition, which began operations in May this year.
Shenzhen BYD Property & Casualty Co Ltd, the auto insurance arm of BYD (HKG: 1211, OTCMKTS: BYDDY), has released its first financial report, showing how the business has performed since it resumed operations.
The BYD insurance unit earned a net income of RMB 6.04 million ($850,000) in the second quarter of 2024, with revenue from insurance business of RMB 67.26 million, according to a report dated July 30 and recently posted on the website of the Insurance Association of China.
In the first half of the year, BYD Property & Casualty realized insurance business revenue of RMB 67.26 million and net income of RMB 18.46 million.
As of the end of the second quarter, BYD Property & Casualty had total assets of RMB 3.69 billion.
The China Banking and Insurance Regulatory Commission (CBIRC) approved BYD's acquisition of 100 percent of E An Property & Casualty Insurance Co Ltd on May 6, 2023. Three years ago, the troubled and scandal-plagued insurance company owned by Tomorrow Holding was seized by authorities.
On May 12, 2023, E An Property & Casualty changed its name to Shenzhen BYD Property & Casualty Co Ltd, one of four specialized online insurance companies in China.
BYD Property & Casualty was authorized to conduct insurance business in several regions in May this year, marking the operation of BYD's insurance business unit is officially on track.
In both the second quarter and the first half of the year, the business saw average insurance premiums of RMB 4,900 per vehicle, according to the financial report.
As a comparison, the average per-vehicle premium for new energy vehicle (NEV) insurance in China in 2023 were RMB 4,003, according to the China Association of Automobile Manufacturers (CAAM).
BYD Property & Casualty's latest solvency adequacy ratio stood at 4,617 percent, well above regulatory requirements, mainly due to its short operating time.
BYD is China's largest NEV maker, selling 1,955,366 vehicles in the first half of the year, including passenger cars and commercial vehicles, up 28.83 percent year-on-year.
In the second quarter, BYD sold 986,720 NEVs, up 40.25 percent year-on-year and up 57.56 percent from the first quarter.
BYD's rival Tesla (NASDAQ: TSLA) registered an insurance brokerage in China in late July, according to a national corporate information database.
Tesla sought regulatory approval to sell insurance products in China more than three years ago, when it registered a company in 2020, but canceled that registration in April of this year.
($1 = RMB 7.1376)
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