Insurance service boosts investors’ confidence in North Korea

By Chi Jingyi and Huang Ge Source:Global Times Published: 2019/7/8 20:53:40

Chinese investors have welcomed a move by North Korea to provide insurance products targeting foreign investment, saying it will boost their confidence in doing business in the country. 

Pyongyang has launched business insurance firms which it hopes will help open up its economy and attract overseas funding. On its official web portal Naenara, North Korea introduced the country's "first insurance and reinsurance broker" company on Friday. 

Founded in May 2015, the Pyongyang-based Rainbow Intermediaries provides information services to help its customers choose insurance products in the market. It also works as an intermediary to link foreign investors with local insurance companies, according to the website of Rainbow Intermediaries. 

"The new insurance intermediary shows a sign of growing complexity and competition in the commercial services within the North Korean economy," said a Chinese businessman. 

The businessman, who asked for anonymity, told the Global Times that he has been doing business in the light industry sector in the country since 2004, and said that as the economy has been growing, the insurance companies were established because of the need for individuals and entities to have secure and wider insurance coverage.

"As far as I know, some investors in the mining industry have bought North Korean insurance covering employees safety. And they welcome insurance coverage for logistics, engineering, credit and other services," he added. 

The number of insurance companies rose after North Korea set up economic and trade zones to bring in foreign investors who had insurance demands. Before that, North Korea had only one insurance company, the Korea National Insurance Corporation, founded in 1947.

Several business insurance firms were launched between 2016 and 2017 including the Polestar Insurance Company, Samhae Insurance Company and Future Re Company, Yonhap News Agency reported in February.

"There were no insurance products in North Korea when I first did business there in 2003 and 2004," a Beijing-based businessman surnamed Wang said on Sunday. Wang cooperated with local Korean firms engaged in timber processing. 

There are always risks when investing in overseas markets, and the new insurance products from local firms would give some guarantees to Chinese investors, Wang said, noting that property safety insurance is what many businessmen expect.

Posted in: ECONOMY

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