Ant Financial’s mutual aid platform hints at insurer tie-ups as users hit 80 million

By Nicole Jao
1 min read
(Image credit: Alipay)

Ant Financial has hinted that its mutual aid platform could collaborate with insurance providers as user numbers continue to swell, Chinese media reported.

Why it matters: Mutual aid platforms like Ant’s Xianghubao started gaining traction in China last year, especially among those who have typically not been well-served by the country’s healthcare system. They enable members to share treatment costs equally, and are often seen as more accessible and affordable than traditional products.

  • Other Chinese tech giants have also dipped their toes into mutual aid over the past year. Tencent is a major investor in insurtech startup Waterdrop, which closed a RMB 1 billion ($142 million) funding round in June.
  • Retailer Suning previously said it was testing (in Chinese) a mutual aid product.
  • Xianghubao and other mutual aid platforms have faced regulatory scrutiny (in Chinese) from regulators for promoting their products as insurance products.

“Xianghubao and insurance products complement each other.” (our translation)

Yin Ming, vice-president of Ant Financial

Details: Xianghubao could be open to working with insurance players to raise awareness and develop structuralized and diversified health care products.

  • The collaborations will not drive traffic but educate consumers on products.
  • Yi highlighted real-name verification, no cash pools, end-to-end risk controls, and transparency as four key principles.

Context: Launched in October, Xianghubao hit 10 million users in less than a week by leveraging Alipay’s vast userbase.

  • The company said in April that it aims to reach 300 million users within two years.
  • Average fees are shared by all members, and they contribute between RMB 0.1 and RMB 0.5 twice per month.
  • Xianghubao charges an 8% premium each time compensation is paid out, which is lower than the 40% average from traditional non-life insurers and 20% from personal insurers.
  • Users have questioned (in Chinese) the significant rise in Xianghubao fees as well as the rising number of members who have received aid. The company said the increased cost is partly due to rapid user growth.
  • Alipay offers insurance policies to consumers as well as businesses by partnering with other insurers like Taikang Insurance and Ping An Insurance.