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DCP Completes Strategic Investment in Datong, Becoming Its Largest Institutional Shareholder

Nov 29, 2021


(Beijing, Hong Kong, November 29, 2021) DCP announced the completion of a strategic investment in Datong Insurance Service Co., Ltd. ("Datong" or "the Company"), and has become the Company's largest institutional shareholder. DCP indicated that it will work closely with Datong's management team to create a new insurance ecosystem driven by product customization, demand matching, and a comprehensive service matrix to provide professional insurance services to Chinese consumers.

Founded in 2008, Datong is a leading insurance brokerage firm providing professional insurance services in China. Based on the Company's sophisticated "productization" of insurance services as well as its high quality, well-educated professional agents, the Company offers thousands of insurance products from over a hundred P&C and life insurance companies. The Company employs digital tools to effectively connect different parties within the insurance ecosystem and creates value for both insurance companies and consumers. In 2020, Datong ranked among the Top 20 insurance brokerage firmsin the world, becoming the only Asian company on the list.

With the continuous growth of the Chinese economy, increased per capita income, and large aging population, demand for medical and healthcare services in China is surging, generating significant demand for commercial insurance and related services. China's current life insurance premium per capita is only 19% of that of the United States and 13.5% of that of Japan, indicating substantial growth potential for the insurance industry.

As experienced in mature insurance markets of developed countries, the separation of underwriting and sales of insurance products will be inevitable and professional third-party brokerage firms will become an important business model. Currently, the penetration rate of third-party insurance brokerage firms in China is only 2.3%, compared to 47% in the United States and 17.8% in Japan, implying significant growth potential for the insurance brokerage sector in China. With rising demand for insurance planning, product comparison and claims services, professional insurance brokerage firms are expected to experience robust opportunities, with 20+% CAGR sector growth expected over the next five years.

Datong places significant value on its agents' educational background and professionalism. Over 80% of Datong's agents hold at least a bachelor's degree and are experienced professionals with diversified industry backgrounds including TMT, accounting, finance, investment banking, and management consulting. In addition, Datong is committed to the digitalization of insurance services and has created a service platform for online and offline collaboration. Leveraging the Company's accumulated strength and riding on the tailwind of the insurance service industry, Datong is expected to continue its rapid growth trajectory in the future.

Mr. Jiang Ming, Chairman and CEO of Datong, said: "Datong focuses on the development of the industry's infrastructure and establishment of an insurance services ecosystem. We are committed to making insurance 'easy to buy, easy to claim and easy to use', improving consumer experience and driving the advancement of the insurance services industry. We are delighted to enter into this strategic partnership with DCP. The DCP team has 28 years of investment experience in China and has nurtured numerous leaders across various industries. In the financial services sector, DCP has successfully led investments in industry leaders such as Ping An Insurance, CICC, and Far East Horizon. In addition to capital support, DCP will bring us world-class operational capabilities and corporate governance expertise. We look forward to working closely with DCP and inject new momentum into China's insurance services industry, and drive industry transformation and development towards a better future. "

Mr. David Liu, Executive Chairman of DCP, said: "We are excited to enter into this strategic partnership with Datong. Datong has an outstanding professional management team, best-in-class insurance agents, deep industry insights and a forward-looking vision for the sector. With rising demand for professional insurance services, China's insurance services industry is experiencing a pivotal transformational moment and can look ahead to exciting growth opportunities. DCP will bring our deep operational expertise and extensive industry experiences to Datong and work closely with the management team to further reinforce its market leading position. "