Why Invest in Huize
Huize at a Glance
In 2006, we launched our online insurance business under the “Huize” brand, and are now a leading digital insurance product and service platform for new generation consumers in China. We distribute insurance products underwritten by our insurer partners and help them reach a larger number of insurance clients.
Why Invest in Huize?
Dual-Engine Business Model Sustains Our Leadership. We operate as an independent intermediary platform with a dual-engine business model by 1) helping our insurer partners distribute their products to potential customers effectively and efficiently, and 2) providing potential customers with one-stop insurance solutions from online consultations and product recommendations to claims assistance services. The dual-engine “insurer-client” model forms a virtuous cycle that fosters a strong network effect, which strengthens our leadership position as a go-to gateway in China’s online insurance industry. As of the end of September 2022, we have partnered with 106 insurer partners, representing a substantial portion of all licensed insurance companies in China, and have cumulatively connected about 8.3 million insurance clients. In the third quarter of 2022, total GWP and FYP facilitated on our platform increased by 29.4% and 34.0% year-over-year to RMB1,249.0 million and RMB684.9 million, respectively.
Long-term Life and Health Insurance and Independent Insurance Platform as Our Niches. We specialize in offering long-term life and health insurance products through operating an independent insurance product and service digital platform. This renders us the highest growth potential among all products and channels in China. Leveraging our 16-year track record, insurance expertise, actuarial capabilities, risk management capabilities, and huge client database, we also co-develop tailor-made life and health insurance products with our insurer partners. The GWP contribution of long-term life and health insurance products has remained above 90% for twelve consecutive quarters. In the third quarter of 2022, GWP for our customized products accounted for 72.9% of total GWP.
Targeting the Lifetime Insurance Needs of New Generation Consumers A substantial portion of our client base is from the younger generation. They are typically well-educated, tech-savvy, and have a strong preference for online transactions. In the third quarter of 2022, the average age of those who purchased long-term insurance policies through our platform was about 33.7 years old. Our online open platform and extensive offline layout cover the entire insurance life cycle and provide insurance customers with a wide spectrum of products, one-stop services, and a streamlined transaction experience across all scenarios. Our data technology also supports the analysis of customer behavior, personal and family insurance needs, and risk pricing. For the first seven months of 2022, the average persistency ratios of these products in the 13th and 25th months have sustained at an industry-high level of above 91% and 96%, respectively.
Revenue Generation without Underwriting Risk in a Cost-effective Way. We primarily generate revenues from the insurance brokerage fees paid by our insurer partners. As a licensed insurance intermediary operating an online platform, we do not bear underwriting risks. We believe by leveraging the Internet, technology, and our data analytics expertise, our business model enables us to reach the insurance retail market in a more cost-effective manner. In the third quarter of 2022, total operating revenue increased by 11.6% year-over-year to RMB351.8 million while total operating expenses decreased by 27.7% year-over-year to RMB115.9 million
Three-Year “Agents, Businesses, Customers (ABC)” Strategic Plan. Since our listing on the Nasdaq Global market in February 2020, we have entered into the Business Strategy 3.0 era, focusing on “smart insurance”. In 2022, we have set a strategic roadmap for the next three years to build an omnichannel digital insurance service ecosystem that integrates “Agents, Businesses, Customers (ABC)” by leveraging our investments in technology and digitalization. To customers, we will leverage our proven online platform with our expanding offline service coverage to enhance our customer acquisition capabilities and deepen engagements with our high-value customers to enhance retention and repeat purchases, thereby optimizing customer lifetime values. To businesses, we will further drive industry digitalization by developing and exporting technology to insurance companies in the areas of business development, customer service, and product innovation. To agents, we have established a new business line targeting independent offline insurance agents to empower them with a diversified insurance product matrix, digital customer acquisition capabilities digital business development tools, and customer service support. We aim to build the most trusted brand of one-stop online insurance platform and become the go-to insurance service portal for young, middle-class families in China.