PICC Property and Casualty Firm Restricted (PICC P&C) has finalised new reinsurance framework agreements with its associates PICC Reinsurance and PICC HK.
The agreements will run from 1 January 2026 to 31 December 2026.
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PICC Reinsurance and PICC HK are PICC P&C’s sister entities below final guardian PICC Group.
Underneath the preparations, the three corporations will interact in mutual cession and assumption of treaty and facultative enterprise, with phrases decided in step with prevailing market situations.
Cession and assumption ratios will vary from 0.1% to 80–100%. Fee charges shall be capped at 45% for ceded enterprise and 40% for assumed enterprise.
PICC P&C mentioned the phrases had been reached by means of arm’s-length negotiations and adjust to all related regulatory necessities.
Because the offers represent persevering with related transactions below the Hong Kong Itemizing Guidelines, they are going to be topic to periodic reporting, annual evaluate and any essential public bulletins. Unbiased shareholder approval shouldn’t be required.
To safeguard equity, PICC P&C has put in place inside monitoring mechanisms to make sure that the phrases stay akin to these supplied by unbiased third events.
The corporate has set annual caps for premiums ceded to PICC Reinsurance at 6.5 billion yuan ($929m), and fee funds at 2.9 billion yuan ($414m). These limits had been set on the subject of projected premium development and historic transaction knowledge.
PICC P&C mentioned one rationale for getting into into the agreements with PICC Reinsurance is to diversify its threat publicity and assist extra secure operations.
After reviewing the preparations, the board, together with unbiased administrators, concluded that the transactions shall be carried out on regular industrial phrases within the extraordinary and standard course of enterprise.
The board additionally considers the phrases and annual caps to be honest and cheap, and believes the agreements are in the perfect pursuits of the corporate and its shareholders as a complete.
