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. At the end of 2021, we have partnered with 109 insurer partners representing a substantial portion of all licensed insurance companies in China and have cumulatively connected about 7.5 million insurance clients with more than 62 million insured. This has helped boost our total GWP and first-year premium facilitated by us by 66.2% and 99.2% YoY to Rmb5,018.2 million and Rmb3,123.8 million, respectively, in 2021.
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 amongst all products and channels in China. Leveraging our 15-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. Long-term life and health insurance products contributed to 97.0% of our total GWP in the fourth quarter of 2021.
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 fourth quarter of 2021, the average age of those who purchased long-term insurance policies through our platform was about 35.3 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 purchase scenarios. Our data technology also supports the analysis of customer behavior, personal and family insurance needs, and risk pricing. In the fourth quarter of 2021, the average ticket size of our long-term life and health insurance products was RMB9,593. As of November 2021, our persistency ratios of these products have sustained at an industry high level of 94%.
Delivering Distribution Value and Digitalization for Fast-growing Insurers. Our distribution capabilities are especially valuable for fast-growing insurance companies seeking efficient distribution channels. We have accumulated a large amount of multi-dimensional user data through 15 years of operations; leveraging our proprietary user data, together with our unparalleled data capabilities, intelligent client segmentation, and selection process, we empower our insurer partners to more efficiently grow their client base, improve operating efficiencies, and manage risks. We have also integrated critical steps in the insurance policy distribution process such as intelligent underwriting and in-force policy administration in our system. Going forward, we will export our digital and technology capabilities to insurance companies and aim to empower the digitalization upgrade of the industry throughout the value chain and generate new revenue streams in the form of technical service income.
Revenue Generation without Underwriting Risks 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. Our total operating revenue increased by 84.0% to RMB2,245.0 million in 2021.
Moving Towards the “Smart Insurance” Era. 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 the 3.0 era, we will focus on AI technology development to enhance efficiencies, risk management, and customer lifetime value. Our proprietary algorithms are embedded in all critical operational areas, such as insurance product recommendation, intelligent underwriting, claim settlement services, and risk pricing suggestions for products co-developed with insurer partners. In 2021, our “Xiao Ma Claim” service has assisted users in settling over 43,000 claim cases, with a total claim settlement amount reaching RMB570 million. We strive to maximize the benefits that we can bring to our users by building a more integrated insurance ecosystem and offering high-quality insurance products with value-added services. We aim to become the go-to gateway for younger generation in China’s online insurance industry.