China Pacific Insurance (Group) Co, the nation's biggest privately owned insurer, plans to sell stock in an initial public offering (IPO) overseas as early as next year to boost capital for funding business growth.

"Insurance is a capital-intensive business," said Wang Guoliang, chairman of the Shanghai-based insurer, in an interview in Hong Kong. "We plan to sell shares in overseas markets, such as in the US and Hong Kong, next year or the year after." The IPO won't be as big as the US$3.47 billion offer by China Life Insurance Co, the nation's largest life insurer, in 2003, said Wang, declining to be more specific.

China's insurers, most of which have low solvency margins because of rapid expansion in the past few years, are seeking ways to increase capital and improve management amid increased competition. The country's insurance market grew at an average 25 percent in the past five years, outpacing the US and Europe.

China Pacific, the nation's fourth biggest insurer, last month agreed to sell 25 percent of its life insurance unit to Carlyle Group and Prudential Financial Inc for US$400 million to increase its ability to meet claims.

China Pacific, which sells both life and non-life coverage, had premiums of 40.5 billion yuan (US$5 billion) in the year's first nine months.

China Pacific plans an IPO of the group first before listing its life and non-life units, Wang said. China's three biggest insurers have all sold shares to the public.

(China Daily November 4, 2005)