A new medical protection business model revolutionize the Chinese insurance sector

Jack Ma, executive chairman of Chinese internet conglomerate Alibaba Group

Jack Ma’s group Ant Financial has recently launched a new healthcare solution: Xiang Hu Bao, literally meaning “mutual protection”, a medical cover.

Since October 2018, Xiang Hu Bao has attracted 50 million of customers, with the ambition to gather 1/5 of the global Chinese population (i.e. 300 million people) within 2 years. Xiang Hu Bao has a free membership and there is no monthly premium to pay. In the event of a claim, the entire community shares the health costs of the patient. The platform covers over 100 types of illnesses, including critical and long-term diseases. When a dispute occurs,  a jury made of pre-approved members of the community, vote on whether to pay the claim. Besides this crowdfunding-based “insurance” concept, what’s also new is the fact that the solution is completely digitalized. With 50 million of members, there are only 50 employees from Ant Financial working for Xiang Hu Bao. Everything is managed from an app, payments are made through Jack Ma’s Alibaba online payment solutions, and claims are analyzed through machine learning and AI. This cheap and communal solution seems like the future of healthcare covers in the soaring Chinese insurance market.

Source : Business Standard, 21 may 2019